SVG ranks lowest in financial literacy among EC nations

St Vincent and the Grenadines has been ranked as the Eastern Caribbean country with the lowest levels of financial literacy.

The findings came out of a Financial Literacy and Financial Inclusion Survey which was commissioned by the Eastern Caribbean Central Bank (ECCB) and conducted in eight territories in the Eastern Caribbean Currency Union (ECCU) including Anguilla, Antigua and Barbuda, the Commonwealth of Dominica, Grenada, Montserrat, St Kitts and Nevis, St Lucia and St Vincent and the Grenadines (SVG).

The assessment for financial literacy was based on financial knowledge, such as understanding inflation, the time-value of money as well as simple and compound interest, financial behaviour- budgeting, borrowing and savings- and attitudes about spending, saving and planning.

The countries were ranked out a total of 20 with SVG scoring 11.7, the lowest of the eight while Anguilla scored the highest- 13.1. Antigua and Barbuda scored 12.7, Dominica 12.2, Grenada 12.2, Montserrat 12.6, St Kitts and Nevis 12.2 and St Lucia 11.8.

The survey revealed that only 3 in 5 adults met the minimum target score for financial behaviour, only one in two adults met the minimum target for financial knowledge and only one in five adults met the minimum target for financial attitude.

The average financial literacy score amongst the countries assessed was 12.2 and Governor of the Eastern Caribbean Central Bank (ECCB), Timothy Antoine said urgent action is needed to address the low rates of financial literacy and inclusion in the ECCU.

The Governor said while the region boasts of adult literacy rates above 90 per cent, financial literacy rates are “low and lugubrious”, evident in the high number of persons who fall victims to scams offering prizes for competitions in which they were never registered.

“How do we explain the following…. persons engaging in hire purchase are ignorant or indifferent to interest rates with some as high as 35 per cent. The proliferation of payday loans which essentially means attempting to ride up on a down escalator. It a veritable debt trap.Highly credentialed persons, with multiple degrees who are clueless about managing their personal finances.”

Antoine said it was time for a “strategy to scale up” financial literacy which, as he noted, would also lead to an improvement in financial resilience.