By Elena Karkoti
Surveys consistently highlight low levels of financial literacy across the EU and worldwide and CySEC’s own analysis confirms this. Given the importance of finance in today’s society, tackling this challenge is a key priority for regulators, as part of their mandate to safeguard the public from financial harm.
One significant obstacle to financial literacy is the lack of motivation or interest in learning important financial skills and concepts. Many people do not see the immediate benefits of basic financial education. Additionally, financial topics can be complex and intimidating, with complicated terminology and abstract concepts acting as barriers to understanding.
Without cohesive and coordinated efforts among regulators, educational institutions, government agencies and private organisations, the overall effectiveness and reach of financial education initiatives can be compromised.
To address this, CySEC has joined forces with the Central Bank of Cyprus, the Ministry of Finance, the Ministry of Education, Sport and Youth, and the two state universities in Cyprus to formulate a new National Strategy for Promoting Financial Literacy and Financial Education in Cyprus. This is in addition to CySEC’s own multifaceted approach to enhancing financial literacy.
A key imperative for these initiatives is the recognition that young people are a growing force in the investment market, with a rising appetite for riskier products. We strongly believe that financial education should start at an early stage and form part of the national core curriculum. We have emphasised the need for the integration of an independent financial education course into school curricula, making it available to all children.
CySEC has also developed a number of tools and resources on our website for both young people and adults. These resources include a Financial Education Hub that allows users to test their money skills in a Knowledge Quiz, as well as a series of Investor Guides, such as a guide to protect investors from fraud and a Guide to Sustainable Investments. Our aim has been to turn complex financial concepts into easily understandable language and enhance overall financial education, as the lack of it has repeatedly proven to be very damaging to an individual’s long-term financial well-being.
Sadly, young people and the elderly are often more vulnerable to scammers and are frequently targeted by unscrupulous individuals. The pervasive use of technology has created a digital landscape where misinformation spreads rapidly, leading to financial harm for unsuspecting individuals. The widespread use of smartphones, social media advertisements and financial influencers (“finfluencers”) who can reach a broad audience has significantly contributed to investment risks.
Hence, a key feature of our programmes has been to develop specific materials for platforms such as X (formerly Twitter), LinkedIn, Facebook, and Instagram, which are popular among young people. We use these platforms to disseminate key messages and reinforce our commitment to promoting financial education.
Every year, we also make student awards that incentivise students to explore topics aligned with CySEC’s responsibilities and sector supervision, promoting understanding among students.
At the same time, technology can provide unparalleled access to educational resources, promote financial inclusion and allow individuals to enhance their financial literacy and skills through online learning platforms, tutorials and interactive tools. By leveraging technology for learning, individuals can empower themselves with the knowledge needed to identify and avoid fraudulent schemes.
There is some exciting work going on in this area and collaborative efforts between regulatory authorities, financial institutions and other stakeholders are paving the way toward the development of new tools and initiatives that protect the financial well-being of the public and prevent individuals from falling victim to financial fraud. Ultimately, this collaboration can only foster a more secure and informed financial environment for all.
CySEC’s goal is to empower future generations with the necessary knowledge, attitude and skills to effectively manage their finances and make informed financial decisions in the future, while enhancing the general public’s ability to safeguard themselves from the potential risks associated with financial investments.
This is why CySEC regularly attends various events, seminars and conferences in Cyprus dedicated to promoting financial literacy and education. It also makes appearances on television, radio, and other media platforms. Additionally, CySEC participates in global campaigns to raise awareness about the importance of early financial education, such as Global Money Week. In October 2024, CySEC will also take part in World Investor Week.
