Basic everyday financial knowledge

Professionals dedicated to the financial sector defend that financial literacy and basic economic concepts must be present from school. Indeed, organizations such as the World Bank, the ECB or the CNMV, among others, have promoted various programs aimed at increasing the financial literacy of the population in general and of the youngest in particular.

And it is that, for example, knowing what a loan is and what it implies, what are the interests, the personal income tax, the VAT or how to contract a mortgage or a plan of retirement, among other things, as financial specialists warn, they should be knowledge that we all need to familiarize ourselves with from childhood. However, the reality is different.

75% of Spaniards admit to having financial deficiencies

It is necessary – and hence International Financial Education Day this week – not only to know about a precise and specific product that interests us, but also to know in general how the money market works and how it affects or can affect our daily lives.

This year, in addition, it is planned to focus on responsible use of finance with the environment. Under the motto “Your finances, also sustainable”, we want to make the population aware of the need to have a positive impact on the environment with each of our financial decisions.

In this sense, compliance with ESG (Environmental, Social, Government) criteria in any financial decision should become a habit. To achieve this, more and more entities have in their product portfolio sustainable investment funds, green and social bonds, social venture capital or green loans. This is the case with Banco Santander, a founding member of the Net Zero Banking Alliance, which intends to advance and also support its clients in the transition to a net zero emissions economy by 2050.

The importance of managing the national economy

In Spain, financial education is learning in waiting. According to PISA data collected by the OECD, young Spaniards are more than ten points below the average in terms of knowledge of money, economy or finance. But, in addition, there is another interesting detail in this report: 95% of the people questioned affirm to have learned financial concepts in their family environment.

The CNMV and the Bank of Spain have also warned of this problem, according to the latest Financial Skills Survey (ECF) of people aged 10 to 80, 75% of the Spanish population admits to having to improve your knowledge in financial matters

Is there a solution to this problem?

In this sense, the OECD urges public and private officials to promote financial education programs and training initiatives that alleviate the knowledge gap.

“Formal financial education in school can also help reduce this inequality in the next generation,” the aforementioned report points out. With this in mind, and in order to achieve true financial inclusion and to contribute to the progress and development of society, organizations such as Banco Santander have been promoting financial education for years, especially among the most vulnerable groups in society. company.

The participants of the first financial education workshop for immigrant women thanks to the collaboration of Banco Santander and the Miguel Castillejo Foundation. @Santander Bank

Six million financially independent people since 2019

Banco Santander develops and collaborates with several financial education initiatives in the countries where it operates. One example is Finance for Mortals, a program born almost 10 years ago and recognized as one of the leading financial education programs in Spain, both by the Bank of Spain and by the CNMV.

This is a project that aims to ensure that the most financially vulnerable groups better understand the current financial and economic culture with a clear and inclusive goal. The initiative promoted by Santander with the collaboration of the Financial Institute of Santander (SANFI) closed 2020 by offering financial education to 65,129 people. This training work is possible thanks to the volunteer employees of the entity, responsible for giving financial education sessions to different groups such as the elderly, children and adolescents or social entrepreneurs, among others.

In addition, Finance for Mortals has broadened its scope this year, reaching more and more financially vulnerable audiences:

* Finances for Mortals-Educational Justice. Through an agreement signed between Banco Santander and penitentiary institutions, basic financial education is provided for the inclusion of people deprived of their liberty in prisons. For the moment, workshops have been given in the prisons of Teixeiro, El Dueso, Picassent and Burgos and they are expected to expand to other parts of Spanish geography in the coming weeks.

* Financial education for immigrant women. A specific program that is now taught after the collaboration agreement concluded with the Miguel Castillejo Foundation for the launch of training workshops on the subject intended for immigrant women and other groups at risk of exclusion in Andalusia.

On the other hand, the bank also collaborates with other national initiatives such as “Your finances, your future”, promoted by the Spanish Banking Association (AEB) which has the support of the Junior Achievement Foundation. Since its launch seven years ago, a total of 500 Banco Santander professionals have participated, helping to improve basic financial literacy for some 5,400 young people in secondary education.

Projects such as those described above, in addition to other lines of action such as facilitating access to basic financial services or providing financing and tailor-made products for individuals and SMEs in economic difficulty, have Contributed to the financial empowerment of six million people since 2019, on the path the entity has charted, which aims to reach 10 million beneficiaries by 2025.

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