By By Delisa Magagula
Recent statistics paint a troubling picture of financial literacy levels in the country.
According to the latest report, only 26% of citizens demonstrate overall financial capability, while a staggering 62% fail to plan their finances.
Furthermore, 68% of individuals struggle to control their finances, and 61% admit they do not know how to manage their money effectively.
According to the report, these numbers reveal a deep-rooted issue that threatens both individual financial security and the broader economy.
Addressing this growing concern, Minister of Finance Neal Rijkenberg emphasized the urgent need for financial education reforms.
He said that the data highlighted a critical gap in financial knowledge among the people and warned that poor financial literacy led to rising debt levels, economic vulnerability, and a diminished capacity for wealth creation.
He stressed that it was the responsibility of leaders and stakeholders to change this trajectory.
Meanwhile, economists warned that financial illiteracy had far-reaching consequences. Dr. Alex Mabuza, an economic analyst, pointed out that low financial capability directly affected national economic growth.
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He explained that when the majority of the population lacked financial management skills, it impacted savings rates, investment levels, and ultimately, economic resilience.
He added that financially educated citizens contributed to a stable financial system and sustainable economic development.
Another economist, Thandi Zwane, noted that a lack of financial literacy led to higher levels of personal debt, particularly through informal lending and predatory financial products.
“Many individuals fall into cycles of debt due to a lack of understanding of interest rates and repayment terms. Without intervention, this will continue to trap people in financial instability,” she said.
Zwane also highlighted the impact of financial illiteracy on entrepreneurship. She explained that small business owners often struggled with financial planning, pricing strategies, and investment decisions, which limited their ability to scale and sustain operations.
“Supporting financial literacy among entrepreneurs could lead to stronger business performance and greater job creation,” she added.
Experts agreed that financial literacy and financial inclusion were closely linked. They noted that when individuals understood financial concepts, they were more likely to utilize essential services such as banking, loans, and insurance.
This, in turn, promoted economic participation and reduced the risk of financial exclusion, particularly for marginalized communities.
Minister Rijkenberg stressed the importance of multi-stakeholder collaboration in addressing the crisis.
He said that financial literacy must be integrated into school curricula, community education programs should be launched, and partnerships with financial institutions should be established to provide necessary resources.
He emphasized that ensuring financial education was accessible to all was not just a matter of policy but a moral imperative.
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Government officials and financial sector leaders were being urged to implement policies that promoted financial education.
By fostering an environment where individuals had the knowledge and tools to make informed financial decisions, the country could dismantle barriers that prevented full economic participation.
Rijkenberg asserted that young people must be empowered with financial knowledge to secure their futures and drive economic growth.
He stated that there was an obligation to ensure that every citizen was equipped to navigate the complexities of the financial world.
As the government, educators, and financial institutions considered their next steps, one thing was clear: financial education was no longer optional it was a necessity for economic stability and growth.
