Financial literacy in Egypt and the world is lagging: As financial markets become more advanced and developed — and with a wave of turbulence in global markets to boot — being financially savvy is gaining increasing importance. The concept of financial literacy is by no means a new one, but it appears to be slow on the uptake both here in Egypt and on a global scale, research shows. There are some attempts both within and beyond traditional educational institutions, but these remain limited in scope, our sources tell us.

First things first: Financial literacy is holding the necessary knowledge and skills to make big financial decisions, including managing your personal finances, budgeting, managing debt and tracking your spending. Think of it like this: Financial literacy is the core of your relationship with money, with it being a lifelong journey that is easier to walk through if you begin early. Being financially literate underpins achieving investment or saving-related goals, business management, or even setting up successful retirement plans.

Only 33% of the world’s population are financially literate, according to Standard & Poor’s 2014 Global Financial Literacy Survey (pdf), which surveyed over 150k people from 140 countries. The survey measures the concept of financial literacy using questions gauging the basic knowledge of four fundamental concepts related to financial decision-making, including their knowledge of interest rates, interest compounding, inflation and risk diversification.

In Egypt, the picture is only slightly worse: Around 27% of Egypt’s population is financially literate (some 30% of our male population and 25% of women in the country) qualify as financially literate, according to the survey.

Financial illiteracy is clearly common — but there are also significant geographic and demographic-based disparities: The report notes that women, individuals from lower socioeconomic backgrounds, and those with lower levels of education tend to suffer gaps in financial knowledge. This trend holds up within developing and developed economies alike, the report says. But individuals surveyed in major advanced economies had a stronger grasp on financial concepts than those in major emerging economies, the report notes.

Integrating FinLit in education as early on as possible is critical to improve these statistics, May University in Cairo (MUC) finance and investment assistant lecturer Ramy El Galy told Enterprise. El Galy suggests that weaving in some basic money knowledge at the preparatory and secondary stages of schooling would be most effective, since these are formative stages for students’ knowledge. “This would help students understand everything related to their finances and allow them to define their future course and best options in terms of studies and others in the future,” he said.

So far, we’re seeing some of that educational integration — but only at the university level. MUC business administration students study courses related to financial knowledge in their freshman year, such as accounting, finance and its fundamentals, including finance for institutions, individuals, and non-finance professionals. These courses provide them with theoretical financial knowledge and practical knowledge of its application in their personal lives. Students also take investment courses — including financial markets and institutions, as well as how to invest in the bourse — later on in their junior and senior years, once they’ve declared their majors, El Galy told us.

There are other institutions outside the formal education system that are working on pushing FinLit education: Several institutions currently offer financial literacy courses in Egypt, most notably the Egyptian Banking Institute (EBI), the Central Bank of Egypt’s training. The EBI offers financial literacy under its Training for Employment (TFE) e-learning program. The program, offered in two versions for governmental and private universities, targets commerce, economics, and political science seniors, as well as fresh grads, according to the EBI’s website. The EBI’s website also offers access to FinLit e-learning, including educational videos for adults and children. In 2012, the EBI launched the “Shaping the Future” initiative, which received several awards for spreading awareness on financial literacy, enhancing the ability to manage finance, and the understanding and utilization of various financial services to achieve financial inclusion. Also jumping on the bandwagon: The National Council for Women, which joined forces with the International Labor Organization (ILO) to provide a financial literacy program under the Decent Work for Women initiative in Egypt, Tunisia, and Morocco. The latest round of the program was held in August.

But even these options are limited: Only business administration students at MUC have access to these courses, he said. Other universities integrate financial literacy concepts in their finance management courses — but this is typically at the discretion of each professor. El Galy suggested it would be far more beneficial to expand them to the entire student body, regardless of their area of study, to ensure a wider reach. Meanwhile, the EBI’s training is specifically geared towards preparing and qualifying students for the job market, rather than for a general understanding of financial concepts in daily life, he said.

There are, however, some options for independent learning when it comes to FinLit: The ILO’s affiliated online learning platform offers an online training course in English, French, and Arabic that aims to unlock financial literacy for participants to manage their personal finances better. It uses examples of women and men in their daily lives, and interactive activities, exercises and assignments to ensure that the provided material is informative and entertaining. It includes four modules and 15 sessions, with the modules including determining financial goals, managing funds wisely, using services by financial institutions efficiently and managing risks and ins.

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