Sunday, 6 October 2013

Assessing Sanusi’s Mentoring Initiative for Financial Inclusion

James Emejo examines the recourse of the Governor of the Central Bank of Nigeria (CBN), Mallam Sanusi Lamido Sanusi, to the classroom to drive his campaign for financial literacy/inclusion
Financial inclusion is basically the provision of financial services at affordable costs to the disadvantaged and low-income segments of the country and has been described as critical to the development of any economy.
However, in Nigeria, with the rate of adult financial exclusion hovering around 46.3 percent -arguably one of the largest in sub-Saharan Africa, the Central Bank of Nigeria (CBN) has recently intensified efforts at deepening financial inclusion through various initiatives, chief of which was the launch of a National Financial Inclusion Strategy (NFIS).
The cardinal target of the document was to strive to reduce the exclusion rate to about 20 percent by 2020, as agreed  to at  the Maya Declaration1 in 2011 through the introduction of a multi-facet approaches.
The CBN believes poor access to financial services had continued to limit the overall development of the Nigerian economy which is still characterised by irregular income pattern, lack of employment, low financial literacy, long distance to access points and lack of appropriate means of identification.

According to the apex bank, about 39.2 million or 46.3 percent of the total adult population of 84.7 million Nigerians are excluded from affordable financial services.
The CBN had consequently been working with financial services regulators as well as key service providers to enhance access to a broad range of financial services including payments, savings, remittances, insurance, pension and credit at affordable costs in other to accelerate growth and sustainable development in line with the Transformation Agenda of the current administration.
Basically, part of the financial inclusion strategy is to increase access to finance and credit at low rates as well as the provision of diverse financial products and create incentives to lure the unbanked into the formal financial market.
However, the CBN Governor, Mallam Sanusi Lamido Sanusi who had remained a major force in the drive to enhance financial inclusion in the country also believed that all efforts towards enhancing access to finance will be in futility without financial literacy which had been identified as one of the major setbacks to achieving financial inclusion.
He had variously argued that it would be useless to provide financial products and services to a population that is uneducated about the offerings and who lacked the basic principles of personal finance.
Moreover, given that savings and investment go hand-in-hand to drive an economy, Sanusi is of the opinion that sufficient financial education should be provided at primary and secondary education levels to guide the youths in their daily decisions as they advance into the complex society.
It was in furtherance of the need to improve financial literacy from the foundation that the CBN, working with Bankers’ Committee and the Federal Ministry of Education had pressed for the integration of financial literacy as a subject in the academic curriculum of both primary and secondary institutions.
Part of the arrangement was to set aside a special day for financial literacy, where the CBN governor, his deputies and chief executives of banks and other financial institutions would speak on financial literacy either in primary or secondary schools.
This concept practically came to being last week when Sanusi officially inaugurated the “Financial Literacy in Schools” initiative, otherwise known as School Outreach Programme- and went a step further to teach the subject before a captive audience, mostly youths and staff at the Model Secondary School, Maitama.
The schools’ outreach was essentially designed by the CBN to inculcate a culture of saving in students and get them acquainted with basic financial education to enable them make informed decisions.
Sanusi had during the class exposed the students to the basic principles of financial prudence by admonishing them not to spend all the money that they earn but save some for investment purposes.
“Money is not an end in itself but you need money to do a lot of things. When you earn an income, the first thing you do is to pay yourself by setting aside at least 10 per cent as savings before using the remaining money to pay for other transactions. If your uncle or any other relations give you money, since the money is not expected, you should save it in a bank for it to yield interest after a period of time,” he told the class.
He also encouraged them to always have a plan on how to spend and save and spend less money than they earn as well as learn to pay themselves first as well as desist from borrowing for irrelevant purposes but rather borrow to invest on tangible things or on decent and profitable ventures that could bring more money.
It is generally believed that standing in his capacity as the apex bank Governor to address students on financial matters would have a lot of impact on the youths.
Sanusi, who had often decried the lack of mentors in the country, told THISDAY: “This is a mentoring programme; it is part of our financial literacy campaign. I believe that it’s extremely important that young boys and girls from a very early age cultivate the culture of saving-learn to spend less than they earn and also understand exactly how they can save their monies; the importance of  Insurance, Pension plan, keeping your money in the bank and what are the products and services.’’
Sanusi said: “We have people who we do not know much about life insurance and how to make provision for their family in case of sickness or death and they are adults.
We have people who do not know the risk they take when they put all their money in one product like the capital market, so the financial literacy will identify and segment the different target  markets and have different  approaches and content.’’
He said the campaign was not looking at financial literacy alone but also financial capability to help an individual to reach optimal decision on financial choice with confidence.
When asked by the inquisitive student what he would do after retirement, the CBN Governor said: “I will visit schools, I hope to continue teaching.
You know, I have had many careers, I started my life during the National Youth Service as a secondary school teacher, and then I became a teacher, then a banker and CBN governor.
But the one thing that I would like to be and I think would be is to a teacher for life.’’
Director, Federal Capital Territory, Secondary Education Board, Mrs. Fatima Baba-Ari described Sanusi’s physical intervention at the school as “life-changing” for the students.
She said: ``the impact of this programme cannot be underestimated, as our students require a lot of mentoring, motivation and inspiration.
This opportunity provided by a reputable institution like the CBN is certainly going to be a life changing experience for these future leaders of this great nation.
She solicited the support of the apex bank in effort to implement the new senior secondary school curriculum by way of providing ideas, personnel and resources.”
The apex bank boss had also blamed the prevalence of social ills in the country on the dearth of mentoring and mediocre by top public office holders who do not lead a good example for the youths to emulate.
Sanusi had recently stated: “This country in my view has failed because of lack of mentoring: people come into positions unprepared, without guidance and they try to learn on the job and it has happened to the most sensitive positions and the most sensitive offices that you can think about in the nation.
”We have a country where people define themselves by their offices. There used to be a time when you point to a man and say he is intelligent or honest or he’s kind or generous or friendly. Now you point to a man and say he’s the owner of that house; he owns that car, he owns a private jet or he’s a governor, he’s a president or a senator.
“I suppose the whole issue of mentoring comes up because we are short of role models and many of the youths that we have are looking desperately for role models as they try to find their way through this difficult terrain that we are trying to navigate as a country.”
Source: ThisDayLive

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