Posted by John Gitau, CEO, Kenya Financial Education Centre

This post is part of the Center for Financial Inclusion’s Expert Exchange: Building A Movement Toward Financial Inclusion by 2020, cultivating conversation around the goal of reaching full financial inclusion by 2020. For further questions about this series, write to Sonja E. Kelly, Fellow, Center for Financial Inclusion at Accion.

As I mentioned in a blog post yesterday, financial literacy is a recipe that does not come together automatically, even if you seem to have all the right ingredients. You may have funding, but the funding could come with unrealistic expectations. You may have students, but the students may not have a good reason to pay attention to the lessons financial literacy training offers.

While I am new to the Financial Inclusion 2020 campaign, I am certain that full financial inclusion, with fully financially capable clients, will not happen without a sound structure to support financial literacy efforts.

Based on my eight years working in financial literacy in East Africa, the following is what I believe must accompany a financial literacy program:

  1. Attractors- Given that deliberate learning is not always fun, a financial literacy program must offer something valuable to the learners. To MFIs, the possibility of a loan may be the attractor. Financial literacy training is directly associated with a pleasurable loan.
  2. Motivators- Once you have got the learners into a training process you must devise a way of holding their attention and internalizing the learning principles. MFIs can set benchmarks, with more loans associated with better demonstration of learning. For example, to be eligible for a bigger loan, customers must be able to demonstrate that they are financially literate. The customer must demonstrate a level of financial capability. The loan would therefore be increased in order to whet their appetites.
  3. Enhancers- Learning must always be fortified with immediate benefits. The benefits are enhancers. I create competition among learners with material benefits to winners. As it is a money training session, I give cash rewards to drive attention to the area I am teaching. I use part of my fee for that. Learning must be associated with pleasure. Learning can be boring especially if the benefits are not visualized immediately.
  4. Relevance- A hotel chain called me to train their staff aged between 25 and 40 about retirement planning. Much as I used all the tricks in the books to help them see the distant future to be enjoyed through investing for the future, most of them were too young to appreciate that picture. To them, there was a long life to be enjoyed and money to be made between their age and retirement. Of course a few learn and start planning but the success of such learning leaves the program organizers disappointed. And it is not about the quality of teaching retirement planning. I am working on a program that can arrest such learning apathy and encourage behavior adjustment to favour early investing.
  5. Reinforcers- To take financial literacy to the next level of financial capability, a lot of reinforcement of positive behavior is needed. When I give financial literacy tasks calling for action, I reward behavior competitively in a way that makes others learners want to take action. This happens when I have follow-ups as is often the case when I work with NGOs.

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John Gitau, a financial education consultant and trainer, is the CEO of Kenya Financial Education Centre an independent centre that offers financial training to staff and clients of financial service providers. His passion is teaching financial literacy and designing financial products for the poor.  From 1992 to 2010, he was a Capital Markets Authority regulated investment consultant with Bridges Capital Ltd. He is a master trainer of trainers with the Global Financial Education Program (GFEP), developed by Microfinance Opportunities in collaboration with Freedom from Hunger and Citi Foundation.

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