Harvesh Seegolam: Bank of Mauritius Financial Literacy Strategy
2022
Speech by Mr Harvesh Seegolam, Governor of the Bank of Mauritius, at the launch of the Bank of
Mauritius Financial Literacy Strategy 2022 and the Second Edition of the Bank of Mauritius
Thought Leadership Series on Financial Literacy in a Digital Era, Port Louis, 28 January 2022.
* * *
Ms Flore-Anne Messy, Executive Secretary of the OECD International Network on Financial
Education
Deputy Governors
Members of my Advisory Panel, Dr Vera Songwe, Dr Robert Wardrop and Mr John Cusack
CEOs of banks and financial institutions attending this event either physically or virtually
Managers and Heads of financial institutions operating in Rodrigues
Members of the media
Viewers following us live on social media
Ladies and Gentlemen
I wish you all a very good afternoon. It is a great pleasure for me to welcome you to the launch of
the 2022 Bank of Mauritius Financial Literacy Strategy which we are rolling out today on a
national basis, and to the second edition of the Bank of Mauritius Thought Leadership Series.
The theme for the round table discussion that will ensue is 'Financial Literacy in a Digital Era'.
Our eminent panellists, who are also members of the Bank of Mauritius Advisory Committee, will
be providing us with their unique insights on the importance of financial literacy, and how to best
implement related strategies in Mauritius.
I wish to announce that the Bank's Advisory Committee has two new members, namely Mr John
Cusack who is an authority on combatting financial crime, and Mr Robert Ophèle, Chairperson of
the Autorité des Marchés Financiers of France and former Deputy Governor of the Banque de
France.
Given the importance of the subject matter, it could not have been more fitting to hold this event
in the very year in which the Bank is turning 55.
The unprecedented environment in which we continue to operate, and which is marked by the
shadow of the COVID-19 pandemic, magnifies the pertinence of today's event.
I would not do justice to the significance of the financial literacy strategy being launched today if I
fail to highlight the dangers of financial illiteracy. Indeed, a lack of financial literacy inevitably
results in implementation of poor financial decisions, thereby dragging down the quality of life of
citizens, and severely impacting the very efficiency of our banking and financial systems.
Ladies and gentlemen,
We cannot speak about financial literacy without taking heed of how past events have played a
major part in reshaping the global thinking on this front. The effects of the global financial crisis
on markets are indeed still fresh in our minds.
History - and a too late array of empirical evidence and research - has shown how the lack of
awareness on the part of consumers in advanced economies drove them to make flawed
decisions on the subprime mortgages and synthetic instruments used for trading.
The drive for higher returns, coupled with a lack of visibility on the risk side, prompted many
people to invest in these securities. These events eventually highlighted the critical importance of
financial literacy, prompting its inclusion as a matter of priority on the agenda of policy makers
globally.
In September 2009, at the G-20 Leaders' Summit in Pittsburgh, a pledge was made, I quote, "to
support the safe and sound spread of new modes of financial service delivery capable of
reaching the poor". Unquote.
The pledge also called on financial standard-setters to promote successful regulatory and policy
approaches and elaborate standards on financial access.
A year later in Seoul, the G-20 committed to the launch of the Global Partnership for Financial
Inclusion and developed a Financial Inclusion Action Plan. At the level of the United Nations,
financial inclusion is positioned as an enabler of other developmental goals in the 2030
Sustainable Development Goals, where it is featured as a target in eight of the seventeen goals.
Ladies and Gentlemen,
Poor financial decisions are often not only the result of financial recklessness, but also of bad
planning, and lack of information. The implications of these shortcomings can easily spiral
beyond control. Undeniably, in today's world, many of these decisions originate from - or are
based upon - the increasing use of technology. Add to that the consequences of 'buy now pay
later' targeted campaigns which can unfortunately fuel poor spending habits and ballooning
debts.
We are all aware that trust is the cornerstone for the effective functioning and stability of the
financial system. As the system evolves and becomes more complex, access to financial
services also becomes easier. What this implies is that there needs to be an appropriate level of
financial education to enable customers to make informed decisions about the suitability of
financial products to their specific situation. Concurrently, a robust financial consumer protection
framework must be in place to shield consumers from abuse and make them become judicious
users of financial products and services.
This is precisely the rationale behind the elaboration of our 2022 Financial Literacy Strategy, and
the subsequent initiatives that will be rolled out. In devising its Financial Literacy Strategy, the
Bank has endeavoured to create content that will meet the requirements of a wide target
audience, encompassing our youth, active population and senior citizens.
The strategy is intended for all consumers, and I am pleased to share that consultations have
already started with our regulatees in Rodrigues for holding Train the Trainer sessions and
financial literacy programmes for the benefit of our Rodriguan brothers and sisters. By the way
our thoughts are with them in these dire times.
The programme content focuses on providing consumers with information on banking products
and services, their rights and obligations, as well as how they should protect themselves and
their hardearned money. The strategy also brings to the fore the dynamic and technology-driven
banking environment in which consumers of financial products are evolving.
This being said, I would also like to make an appeal to providers of financial services. My call is
that you should always act in a transparent manner with your customers by disclosing all
important facts. Do not focus only on the business side and on the bottom line.
More importantly, in your communication to customers, do not omit details which, though they
may seem insignificant or superfluous, may have a huge impact on the obligations and rights of
customers or clients. Otherwise, in the short run, the improvement of business may come at a
hefty price, be it in terms of rising delinquencies, complaints, law suits or even reputational risks.
As a central banker and regulator, I need not emphasise that short term gains are not
worth a longterm pain.
Ladies and Gentlemen,
It is a sobering reality that the COVID-19 pandemic has tragically claimed the lives of millions of
people worldwide. The COVID-19 pandemic has not only led us all to rethink our existing
practices, but to also factor in unexpected scenarios and reimagine opportunities.
Whilst technological advances like mobile phones, internet banking and other digital technologies
were already present in our daily lives, the pandemic has resulted in an acceleration in the pace
of digitalisation of financial services.
As I fathom the radical changes occurring around us, digitalisation is bound to amplify, both in
terms of speed and the dimension of its impact, the transformation of the banking and financial
landscape.
While electronic channels are indeed convenient to the great majority of consumers, we should
also be wary of the downside risks that they can bring. Threats of unscrupulous agents exploiting
loopholes, mis-selling and other legal risks are just some of these.
I am sure that you need no further convincing about the place that financial literacy should
occupy in our lives. Its benefits extend well beyond stronger household balance sheets. Indeed,
financial literacy contributesto the promotion of a more resilient financial system and, ultimately,
to the more efficient allocation of resources within the real economy.
However, the launch of a financial literacy strategy is not, on its own, a sufficient condition for
diffusion among the population. Collaboration and support at all levels of the banking industry
remain the prerequisites for an optimal implementation.
To muster additional resources to support the implementation of its financial literacy initiatives,
the Bank has been strengthening its relationships with other central banks as well as with leading
international financial organisations and financial literacy promotion entities.
The Bank is currently benefitting from the support of the Bank for International Settlements to
craft a strategic plan on data protection. In addition, with a view to widening the scope of its
consumer education strategy and reaching out to the greater number, the Bank is participating to
an initiative driven by the GSBF, the Groupe des Superviseurs Bancaires Francophones.
I am also pleased to share that the Bank of Mauritius is a proud and active member of the
FINCONET, the International Financial Consumer Protection Organisation. To further our efforts,
I have personally ensured that the Bank joined, no later than last year, the OECD International
Network on Financial Education.
I am pleased to announce that the Bank of Mauritius will participate to this year's edition of the
Global Money Week, an initiative spearheaded by the OECD/INFE, and which will take place from
the 21st to the 27th of March next. We have even engaged with the OECD/INFE to be the
National Coordinator for the roll out of the Global Money Week initiatives in Mauritius.
Ladies and Gentlemen,
As I come to end of my address, I wish to express our gratitude to Ms Flore-Anne Messy for
being with us today as keynote speaker.
I also thank our prime stakeholders, specifically the Mauritius Bankers Association and its
members, for their valuable contribution in terms of views and input in crafting this programme
and supporting its roll out.
I rely on your cooperation to make the strategy a success. On our side, you can rest assured
that the Bank will leave no stone unturned to reach out to the population.
I thank you for your attention.