Secondary school students will be taught personal finance lessons through a programme kicking off next year.
The programme promoting financial literacy will be funded by the Hellenic Bank with the cooperation of the education ministry.
Secondary school students will learn about personal budget management and responsible consumer and savings behaviour, as well as the time value of money.
The Hellenic Bank will be working with the assistant professor of finance at the Technological University of Cyprus (Tepak), Dr Panayiotis Andreou, who, in collaboration with Durham University, conducted research regarding the financial knowledge and skills of 881 Cypriot university students.
Andreou’s findings revealed that only 37 per cent of the students surveyed could be considered financially literate individuals.
Low levels of financial understanding can have a large impact on the daily lives of students, as lack of financial knowledge is a decisive factor in the accumulation of credit debt.
“The results of the survey clearly show the need for immediate planning by the government and the adoption of appropriate financial education, for high school students at least, with the introduction of a basic course in personal finance for students in all study areas,” Andreou said.
Findings from a Standard & Poor’s survey (Global Financial Literacy) in 2014 show that among people aged between 15 and 34 in 140 countries, Cyprus seems to be way below the financial literacy rates of other European countries such as Denmark, Finland, Estonia, the Netherlands, the UK, Belgium and others.
The survey also suggests that this lack of basic financial knowledge may have contributed to the exacerbation of the problems faced in Cyprus’ financial sector in 2013.
“It is an unescapable fact that adequate knowledge of economic concepts and the ability to use them is a cornerstone in making sound decisions that are directly linked to the financial well-being of active citizens and in their protection,” Andreou said.