School teachers play a key role in raising the level of financial literacy of Filipino youth, however, they themselves suffer from low pay, low education level, and lack exposure to financial education programs.  

So how can they be expected to boost Filipinos’ financial literacy?

These are the findings of a study by the Bangko Sentral ng Pilipinas (BSP) published in June 2023.

‘Financial literacy’ is the ability of a person to make better and informed financial decisions to manage their wealth properly. It is a skill that is often developed at a young age as financially well-informed children tend to grow as a financially responsible adult, and in order for these children to gain proper financial knowledge, the financial literacy level of the teachers themselves are crucial to the process. 

The Philippines ranks third from last in terms of financial literacy with only 25 percent of its adult population being financially literate among the eight Association of Southeast Asian Nations (ASEAN) countries assessed by Standard and Poor’s (S&P) in 2014, which raised voices of concern across the country. 

Adding to that, formal account penetration among the low-income population has been low in recent year (BSP, 2019; World Bank, 2015). 

As regulator of the banking industry and the country’s currency, the BSP’s advocacies are financial literacy and also financial inclusion - that more Filipinos will have access to formal financial services.

As it is important to first increase the level of financial literacy of the teachers firsthand in order to educate the rest of the population, the Philippines Central Bank specifically looked into the financial literacy level of the teachers in the Philippines through three sets of survey data: the Teacher’s Survey on Financial Literacy conducted in 2022, Metrobank survey data from 2014 (Ravago & Mapa, 2020), and lastly the 2018 CFS Data covering both teaching and non-teaching populations. 

The three major findings are eye openers.

First of all, a teacher’s overall household financial status reflects the financial literacy of the individual teachers themself. Secondly, a teacher’s Financial Literacy Index (FLI) is directly positive to the teacher’s educational attainment. Lastly, there also is a significant positive relationship between a teacher’s financial literacy and the proportion of household members of the teacher who also have a higher level of education. 

All three results show that the level of the financial literacy of the household of an individual results in an individual who is capable of making wise financial decisions. As the results emphasize that an individual’s level of financial literacy is determined by the people around them, aside from implementing financial education within the curriculum of the Filipino students, teachers and non-teaching personnel will also be provided with opportunities to strengthen their financial health, such as savings, budgeting, investing, and more. 

It is also observed that majority of the Filipino population - including teachers - have collective ballooning debt. 

The NATCCO Network’s Aflatoun Program trains teachers how to integrate financial literacy in the school curriculum.  Since 2006, NATCCO has trained 8,418 teachers from 2,098 schools.  So far, 417,000 school kids have savings deposits in 158 co-operatives amounting to Php 440 Million.

By Jiwon Shin

Stamford American International School

Singapore