However, every now and then banks surprise us by doing something really rather good.
Barclays did it by introducing a new vehicle financing scheme and mentioned customer service before any boring details about interest rates and conditions. Stanbic have delighted us by tackling one of the most serious issues we think face Batswana.
We’ve highlighted on several occasions in this column and on GabzFM how worried we are about this. About the dreadful lack of financial knowledge among all sections of society but youngsters in particular.
Yes, it sounds very dull when you’re 15 years old to be lectured on financial matters but it’s incredibly important that our youth learn about things that can make or break their lives and careers.
I’m not exaggerating. We have heard from people who have taken out what seemed like a very modest loan but have ended up with crippling debt. The really bad news is that with a little thought before agreeing to these loans they could easily have seen what would happen. In many cases the mathematics of these loans are actually very simple. It’s just that people either fail to understand or, worse still, ignore the maths.
This deliberate carelessness is just crazy. Intelligent people who can do maths in their heads willingly sign up for debts they know they will have trouble repaying but they are seduced by the lure of something new and shiny.
However, that’s actually their fault and on most days I’m not very sympathetic.
The cases that worry us are those where people who genuinely don’t have a good knowledge of how money works fall into financial traps that they sometimes can never escape.
This is where Stanbic have taken the lead. They have produced 4 booklets designed for use in schools that go into vast detail about money matters. The booklets are called:
• Personal finances
• Money and banking
• Saving and investing
• Introduction to business finance
Each of the booklets is about 40 pages long and they are filled with practical examples. They cover some of the critical issues like compound interest, how to understand a bank statement and practical budgeting. All are done in language that is simple, easy to understand but without being condescending and insulting.
The booklets were originally designed by Stanbic’s parent company in South Africa and are in widespread use in 9 of the 11 provinces in SA and in over 15,000 schools so they are proven to be useful.
At the launch of the booklets at the GICC last week, the Managing Director of Stanbic, Dennis Kennedy said:
“We can help Batswana to avoid the problems of getting too deeply into debt, of learning to ask about the interest rate they are being charged and above all, to avoid falling into a debt trap where you have no choice but to accept exorbitant interest rates. If we can achieve this, than we at Stanbic Bank will have made a difference.”
Later that evening, one of the guests of honour, Linah Mohohlo, the Governor of the Bank of Botswana said:
“As a nation, it is important that we should learn to build up a store of wealth through saving so that we can live without debt related stress and retire from our occupations with financial security. Our beneficiaries would then be in a position to inherit wealth and not debt.”
“There is no doubt that Stanbic Bank’s response to an obvious call for public education has set an excellent example of what a responsible corporate citizen does in areas complementary to its core business. I hope others in the financial services industry, particularly commercial banks, will want to emulate this good customer education deed in which Stanbic Bank is now engaged.”
She’s absolutely right. Strange though it seems the best people to advise us on financial literacy are the sensible lenders, lenders who realise they will benefit when they get sensible customers signing up to sensible finance schemes. Critically we must get to our kids years before they ever need to borrow money. If we educate them early I’m convinced that we as a nation will go a long way towards avoiding the dreadful cycle of crippling debt.
Like I said with Barclays two weeks ago, clearly Stanbic are smart enough to know that taking the lead with things like this will make them look good. They’ll be seen as caring about the community and the nation and courageous enough to address some of the failings of their own industry. But there is clearly a sense of social obligation on show here.
One request though. Don’t just give the booklets out in schools. Let’s all have them?
So to Stanbic I say this. Good for you. Good for taking the lead, good for recognising a problem and even better for understanding that you as a bank have a role to play in helping. And best of all for actually doing something about it!
But, like we said 2 weeks ago, this isn’t an advertisement for Stanbic OK?
This week’s stars!
- Who else but Standard Chartered Bank for so very generously funding the Consumer Watchdog 1st Birthday Party at the GICC today! Every one of the service stars mentioned here and on GabzFM for the last year has been invited along with their managers as well as a range of dignitaries who can help us to celebrate them.
- Batsho at BDO Spencer for cheering up a customer
- Lemogang at Cape Union Mart at Game City for going the extra mile
- Tlhabologo at BTC fro demonstrating what service is all about
- Mike at Veterinary and Agricultural Consultants for being helpful and caring