A Core Subject that is a Headache for Spaniards

Public and private institutions accelerate their plans to improve financial education in Spain, which ranks at the bottom in Europe in this area

Among the concerns of Spaniards, the economic crisis has anchored itself at the forefront of the CIS surveys. Curiously, this focus of concern contrasts with the fact that our financial education is among the least developed in Europe. Spain is the fourth country with the worst training in economics and finance on the continent, according to the latest Eurobarometer on financial education. So much so that only 19% answer basic questions correctly about the impact of inflation or the different types of interest, compared to the EU average of 26%.
The bad news doesn’t end there: only 13% of Spaniards have a high level of monetary culture, far from the 28% in the Netherlands. And why is this the case? Adriana Scozzafava, General Director of the Afi Emilio Ontiveros Foundation, points to the formal education received in Spain at early ages as the main reason: “Although changes have been introduced into the school curriculum, the teaching of economics and finance has been limited and restricted to certain courses.”
To that, she adds a “lack of perception of the direct relevance of financial knowledge in our daily lives, which can lead to a lack of interest on the subject.” The current global economic instability underscores the importance of consumers having the necessary skills to manage their finances effectively. Something that, in many cases, is far from being the case.
A recent study by BFF Bank concludes that 30% of respondents admit to being unaware of aspects related to the attractiveness of bank deposits or their associated interests. Furthermore, despite the rise in interest rates and geopolitical uncertainty impacting the slowdown of activity in the real estate sector, the report states that Spaniards still maintain the idea that real estate “is the safest and most attractive option to invest and protect their savings against inflation.”
In the current situation, Scozzafava sees it necessary for basic concepts like simple and compound interest to be very clear, knowing what they are, how to calculate them, or the impact they can have. In her view, there must be specific training at early ages, and the knowledge gap in the adult population needs to be addressed. And part of that learning, she says, is consolidated in the family environment: “It has been shown that in households with financially knowledgeable parents, children have a better level.”
Beyond learning to control daily expenses and income, save, or plan for the medium and long term, “other skills have emerged in which we need to delve deeper, such as learning to handle digital applications with ease,” says Alberto Aza, spokesperson for CECA. Improving in all of this implies, in his opinion, “that public administrations take on the responsibility to promote plans that boost financial education and that educational institutions apply them in their centers as effectively as possible.”
The public and private sectors share a common framework in the Financial Education Plan (PEF), to which CECA is affiliated, aimed at promoting initiatives that bring financial culture closer to all groups. Taking into account that “young people have different needs than older adults and also different priorities.”
In this context, the need to integrate financial education into the school curriculum is already being proposed, as an integral part of subjects like mathematics or economics. If this proposal materializes, according to the expert, “it would represent a significant advancement.”
AWARENESS
That was precisely one of the objectives of the aforementioned PEF, launched in 2008 by the Bank of Spain and the National Securities Market Commission (CNMV). The strategy, also supported by the Ministries of Education, Consumer Affairs, and Economy, aims to collaborate with as many educational institutions as possible to ensure that the school population becomes aware of the importance of basic finances.
“In 2008, financial education was not discussed in schools except in very specific and closely related subjects，” comments Fernando Tejada, Director of the Conduct Department of the Bank of Spain. Now, thanks to the PEF, although these are not compulsory subjects, “educational authorities have included basic finances in all their curricular paths. We have contributed our part by providing teachers with materials, modules, and teaching resources.”
Beyond the school-age population, the PEF seeks, through outreach and collaboration with as many social agents as possible, to reach segments of the population at risk of financial exclusion, which the Bank of Spain and the CNMV could not reach alone. ONCE, Red Cross, and other NGOs are facilitating this task.
Among those groups at risk of financial exclusion are, even more so due to the unstoppable advance of digitalization, the elderly population. The Spanish Banking Association (AEB), which also collaborated with the Bank of Spain in the development of the PEF, is one of the most active organizations in seeking a solution to this problem.
Juan Carlos Delrieu, Head of Sustainability at AEB, recalls that four years ago, “the Expertclick program was launched together with the Cibervoluntarios Foundation and the support of the Ministry of Social Affairs.” More than 5,000 people have benefited from this initiative, which has facilitated the acquisition of digital skills for free.
Over the last year, AEB has enriched Expertclick with three more projects. Notably, ‘Connecting Seniors’: “We seek for seniors themselves to share their knowledge about using technological tools with others of their age and in similar situations. This creates a more special bond, as they share a common language and concerns.” The pilot program has been a success, as it will involve about 2,500 people in its first year.
This type of initiative, as Tejada points out, does not mean that the focus on in-person support will not continue to be reinforced. Especially in “rural areas, where there is a higher concentration of elderly population.” So much so that in its latest version, the PEF already includes the intention to implement both digital and physical services.