• June 19, 2024
  • Last Update June 19, 2024 7:37 PM
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KBA launches the ‘Chora Plan’ financial literacy program to boost economy

KBA launches the ‘Chora Plan’ financial literacy program to boost economy

Nairobi,

Tuesday June 11, 2024

KNA by Sharon Atieno/Cecil Oduor

The Kenya Bankers Association (KBA) in collaboration with the Central Bank of Kenya (CBK) has launched the “Chora Plan” financial literacy program aimed at empowering individuals and businesses with the necessary knowledge and skills.

The beneficiaries of the skills are expected to use them to make informed financial decisions and to enhance financial stability and economic growth in Kenya.

CBK Governor Dr. Kamau Thugge said that the Chora Plan campaign is an important plan in Kenya’s quest to build on the financial health of its citizens, and called upon stakeholders to move forward on the financial inclusion frontier as a pathway to shared prosperity for all Kenyans.

He said the bank will be keen to engage stakeholders on how they can create a sustainable framework to coordinate financial literacy efforts on an ongoing basis.

The Governor who was speaking at the launch of the program held at a Nairobi hotel said the initiative will pave the way for a month-long sensitization drive with a focus on building a saving culture on financial planning to enhance financial health of businesses and households.

He said the financial growth has continued to recover globally from January, noting that a positive global outlook is subject to downside risks mainly from the potential escalation of geopolitical tensions and inflation rates.

“Domestically, we have experienced relative macroeconomic instability with the inflation fluctuating around five percent in April and May which is the mid-point range of the CBK,” said the Governor.

He added, “The foreign exchange market has also stabilized and the shilling is one of the best if not the best performing currency in this year vis-à-vis the major currencies.”

Dr. Thugge cited the finance and insurance sectors as one of the key services driving the country’s economic growth and financing other sectors, adding that more can be done to expand the sector to catalyze the country’s growth.

Additionally, he said that financial inclusion is critical for sustained and inclusive economic growth, saying that access to financial services has expanded threefold; from 26 percent in 2006 to 83percent in 2021.

“CBK is in the process of updating the free access service and is looking forward to the results later this year,” he said.

Dr. Thugge announced that CBK has been focusing on the impact component which refers to the financial health and ultimately financial services and products which have to impact on the livelihoods of those using them in critical financial health.

“The 2021 survey employed a framework of financial health on structures of composite index of three main life goals including the ability to manage day to day needs, ability to cope with shocks and the ability to invest in future goals,” said Dr. Thugge.

He stated that the aim of the survey is to determine the outcome of financial inclusion in terms of resilience of the Kenyan population and the potential for growth, noting that the results indicated that the financial health of respondents deteriorated to 17.1 percent in 2021.

“Financial institutions should reflect on whether the financial products and services meet the financial health needs of Kenyans at the bottom of the pyramid,” he challenged the financial sector stakeholders.

Dr. Thugge also urged the financial service providers to be transparent and work on building the customers’ confidence in order to minimize complaints.

Kenya Bankers Association (KBA) Chair John Gachora acknowledged the importance of collaboration in the campaign, bridging the existing gaps in the financial and the people being served.

“The Chora Plan campaign is premised on the prevailing low level of saving and the high financial illiteracy amongst Kenyans,” he stated adding that studies have shown there is a direct correlation between financial literacy and levels of saving, contextualizing the need to cultivate the saving culture in Kenya.

He noted that 38 percent of citizens are financially illiterate, whereas saving rates are lagging behind at 13 percent which he noted is far below the Africa average of about 17 percent.

Gachora said there is need for action to be taken through the Chora Plan initiative so as to reverse the financial health among the population for prosperity among individuals, entrepreneurs and the nation.

Courtesy; KNA

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