. . . as 2016 Money Week campaign ends
Bereng Mpaki
THE 2016 Money Week campaign ended with a call for independent and impartial financial advisors to assist consumers to better manage their finances.
This was highlighted in a presentation by one of the keynote speakers Cilia Allaby, a British education consultant who said Basotho, especially the rural population, needed to have independent financial advice and guidance in order to better handle their money.
She said this was important because financial institutions tended to provide advice skewed towards their own interests rather than those of ordinary people.
She said civil society had an important role to play to ensure the provision of impartial financial advice became a reality.
Ms Allaby’s sentiments were echoed by business consultant and author Mary Bosiu and Lesotho Highlands Development Authority Chief Executive Officer Refiloe Tlali.
Ms Tlali said financial institutions were unlikely to give advice that went against their own interests as businesses.
Catch them early
Ms Allaby said since it was an essential life skill, it was therefore important that children were introduced to financial literacy at a tender age so they would not make wrong decisions regarding their finances.
“Financial literacy is a life skill and that means we must not just leave our children to flounder without giving them that skill,” she said.
She said there was need for vigilance as the financial landscape had become very complicated due to the rise in illegal investment schemes where ordinary people lost out more than their wealthy counterparts.
Central Bank of Lesotho (CBL) Governor Retšelisitsoe Matlanyane said in an ideal world it was the responsibility of parents or guardians to instill financial skills in their children.
However, she said this was a challenge because most parents spent most of their time at work than with their families.
She said as a result, children ended up learning unhelpful financial skills from people around them such as their schoolmates or nannies.
Not unique to the poor
While it would seem that learned and high profile members of the community were immune to financial mismanagement, it had been found that they also struggled with their finances.
Ms Bosiu, a life coach, said she had encountered several instances where it became necessary to coach such people on handling their finances.
“I ended up incorporating financial management in my scope of activities because I realised that high income earners were also at a risk of financial mismanagement,” she said.
She said one common indicator of financial mismanagement was habitual requests for salary advances from employers.
Still a long way to go
Since its inception six years ago, the Money Week campaign has achieved significant growth in scope, reach and in the number of stakeholders taking part in its activities.
Dr Matlanyane said financial education also meant being aware of the available financial solutions in the country and making use of them to improve lives.
She said sadly this was not the case as few people utilised the solutions at their disposal. She said a shift in mindset was necessary to achieve financial education.
She said Lesotho’s global ranking on access to finance was poor due to lack of usage of the financial options.
She said over the years the government had introduced reforms in the financial sector in order to avail financial solutions to the people.
“We should not be initiating financial sector reforms just for the sake of it. They need to be utilised,” she said, adding there was a serious need for the sector to reflect on why this was not happening.
One such recent reform experiencing uptake challenges was the Maseru Stock Market.
The Director of CBL’s Financial Markets Bohlale Phakoe said the field of capital markets was one of the avenues for raising finance, yet it was rarely explored.
He therefore urged people to seize the opportunity to make the financial sector reforms a worthwhile exercise.
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