Financial literacy rate is still quite low in Cambodia based on the fact that only a small percentage of the population in the country has a bank account with majority of the population as still unbanked, said Phillip Bank’s general manager Han Peng Kwang.
He added that financial education or financial literacy is vital for the population because those with higher financial literacy are more likely to plan for retirement when they are old and have stopped working and will know how to build an emergency fund.
He added that financial literacy will help people to be less likely to engage in excessive spending or borrowing resulting in paying exorbitant interest that will affect their long term financial health.
“When the population learn and practice the concept of budgeting, savings, the magic of compounding interest, investment strategies, they will become self-sufficient and achieve financial stability,” he said, adding that it will empowering them to make wiser investment decision and may also prevent them from getting cheated such as investing in Ponzi schemes.
Han said that PhillipBank has played a part by providing financial advice and guidance borrowers to prevent them from becoming over indebted or over leveraged which may ruin their businesses.
Meanwhile, the bank’s related company like Kredit Microfinance Institution has been teaching financial literacy subject to thousands of Cambodians over the years as part of their CSR program.
“I believe that financial education should start from young so they can become financially literate early,” Han said.
He added that this can be a foundation for them to inculcate good money habits from when they are young and prevent them from making financial mistakes that could lead to lifelong financial struggles when they grow older.
“I fully support the idea that it should form part of the education curriculum for students.”
The private sector especially the financial sector can play a more active role to promote this subject collectively and also jointly with the National Bank of Cambodia.