Microfinance Now: Fe de la Cruz
Only two out of every 10 households in the Philippines have bank accounts. Financial education, particularly targeting young people, is therefore a very important part of the financial inclusion strategy of the Philippines’ central bank, says Fe de la Cruz, Head of Corporate Affairs at Banko Sentral ng Pilipinas.
The central bank began its financial education program with young people because they see financial management and saving as a lifelong skill that everybody should have: “We believe that by going through the kids and having the kids develop the habit of saving there will be contagion in the household.”
The central bank has integrated financial education into public education through an agreement with the Ministry of Education at all levels, beginning at the elementary level in First Grade. They have also partnered with the 12 main commercial banks in the Philippines to promote Kiddie accounts, and introduced the banks to the schools, relaxing ID requirements for child savings accounts.
These programs can have important social impacts. For example, overseas foreign workers send 20 billion dollars a year in remittances back to the Philippines. But the phenomenon has a profound social impact in separating families, “we want to make sure that the social cost will be worth it. We want in the future, hopefully the shorter future, for their family to be back together.” And so the central bank works with the families left behind to help them grow their money and inculcate the habit of saving: “It makes the family closer, and makes whole family aware that every centavo that they receive from overseas is something they should value and not waste,” says de la Cruz. “It becomes a choice between having your parent back, or having something that is really not that important.”