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Financial Literacy Low Among Adults in Northern Regio


2009-08-23 23:12:06
This article has been read 570 times.

A survey, undertaken by the United States Agency for International Development (USAID)'s Trade and Investment Programme for a Competitive Export Economy (TIPCEE), and the Ministry of Finance and Economic Planning, has revealed that adults in Northern Ghana have the lowest financial literacy in the country.

According to the survey, the national mean score of the country in 2008 was 44%, compared with 57% as the score for the 2007 Urban Financial Literacy Survey.


While the southern belt comprises the Eastern, Volta, Western, Greater Accra and Central regions, the middle belt involving the Brong Ahafo and Ashanti regions, and the Northern belt, Northern, Upper East and Upper West regions, returned total financial knowledge scores of 51, 44 and 38% respectively, establishing the northern belt as the least financial knowledgeable belt in Ghana.

Presenting the findings of the second baseline survey on Rural Financially Literacy at a stakeholders' forum in Accra, yesterday, the Team Leader of the CDC Consult Limited, Mr. Ernest Dzandu, further revealed that on general basic financial knowledge, the southern, middle and northern belts returned mean scores of 63, 57 and 51% respectively, compared with the sub-component mean score of 57%.

The study was conducted by CDC Consult Ltd., with the specific objectives of providing evidence of the extent personal financial literacy among rural adults, examining why some rural adults were relatively more knowledgeable than others, and finding out how an individual's knowledge influences his/her opinions and decisions on personal financial issues.

Two regions in each of the three geographical belts were selected, and the selection was based on the regions with the highest rural population, except the middle belt, which has two regions.

Mr. Dzandu indicated that in the southern belt, a total of 630 people were sampled, whilst 354 and 316 were also sampled in the middle and northern belts respectively. In all, a total of 1,303 rural adults, aged 18 years and above, were interviewed through face-to-face interactions with a structured questionnaire as the main instrument.

Touching on knowledge of financial institutions, services and products, he astonishingly disclosed that a number of people interviewed, recorded a mean score of 0.45 on a scale of zero to one, saying, "Commercial and rural banks are the well known financial institutions, with respective awareness proportions of 47% and 29%."

Mr. Dzandu intimated that the well-known banking services and products known among adults in rural Ghana, included money transfer, savings and current accounts, representing 74, 37 and 31% accordingly.

He added that the middle, southern and northern belts returned financial institutions, services, and products, scores of 53, 45, and 37% respectively.

The results underline the disparity between the availability of financial institutions, services, and products in the northern belt, compared with the other belts.

On knowledge of laws regulating the financial services industry, Mr. Dzandu observed that knowledge of basic laws regulating the industry was weak, and returned a mean score of 31%.

Although, the male mean score of 50% was higher than the female score of 41%, statistically, females in rural Ghana are more knowledgeable than their male counterparts.

The team leader noted that 53% of rural adults, compared with 78.1% under the urban adult financial literacy survey, had knowledge on insurance.

He therefore recommended, "There is the need to attach importance to rural financial literacy, especially with the ongoing changes on the financial landscape, further shrinking of small businesses, and the emergence of alternative financial service providers, including fraudsters, who bolt away with meager savings of their "clients".

source: allAfrica.com

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