Financial education in SA needs a new start

28 September 2010

The Consumer Protection Act heralds a breakthrough for the rights of South African consumers but a new start must be made in consumer education if the law is to empower people effectively.

The National Consumer Forum, an independent consumer rights advocacy and education group, said that financial education initiatives in particular need to be boosted.

“Our country’s efforts to offer useful financial education to ordinary consumers are not working,” said NCF chairman Thami Bolani. “We need to re-assess how this is being done, and find new ways of putting our resources to work.”

Bolani said that lack of direction, commitment and monitoring are among the problems that hold back a successful national financial education drive.

“We need agencies that will co-ordinate their efforts and empower consumers to build a culture of financial literacy,” he said. “It is no use having good consumer protection laws if consumers themselves are being denied access to the tools and education to make informed choices.”

Bolani said it was vital to include civil society groups and large-constituency organisations like trade unions in national financial literacy initiatives. “The new start in financial education must begin in consultation with representative groups,” he said. “Such initiatives cannot be effective if they remain unconnected with the people who need them most.”

Consumers International, the global federation of consumer groups of which NCF is a member, has called on world leaders at the G20 summit in Seoul, Korea, to set up an Experts Group on Consumer Financial Protection. The group’s function would be to find the best ways of protecting the financial affairs of consumers, and to report these to the G20 summit in 2011.

Among the issues the group should look at would be fair contract terms and charges for financial services, information disclosure, and governance of countries’ financial consumer protection bodies.

Notes for editors and journalists

The National Consumer Forum is a self-sustaining, non-governmental organisation that educates consumers about their rights, lobbies on consumer issues and speaks out where it can on a range of challenges that consumers – especially lower income earners – experience in their daily lives.

We publish a national, free-distribution consumer rights newspaper (Consumer Fair) six times a year, and a monthly email newsletter.
The NCF is an affiliate member of the global federation of consumer organisations – the London-based Consumers International – a grouping of over 250 consumer organizations in more than 120 countries. We support the United Nations Guidelines for Consumer Protection, in particular the right to basic needs: All consumers have the right to basic goods and services such as adequate food, drinking water, shelter, clothing, health care, electricity and education.

National Consumer Forum
012 428 7071

Posted in Media Statements.