May 26, 2017
Source: thebftonline.com l Ghana
A key factor that will prevent many Ghanaians from becoming financially successful is attitude towards saving money. In the meantime, records at the Bank of Ghana show that the savings culture in Ghana leaves much to be desired.
About 70 percent of Ghanaians are unbanked. Out of the 30 percent with bank accounts, only few have a consistent savings habit. According to the World Bank, the gross savings rate in Ghana is below 20%. This situation is similar to that of other African countries such as Burkina Faso (8.59%), Togo (11.66%), Nigeria (12.049), Benin (16.75%), and South Africa (15.14%)
To counter this, there are the three simple steps to develop and sustain a savings attitude. These are setting achievable savings goals, rewarding yourself for reaching small milestones and possibly, automating your savings.
According to Nana Dwemoh Benneh, Head of Personal & Business Banking, Stanbic Bank, savings help acquire valuable assets, provide financial security, and improve people’s standard of living. It also serves as a buffer during emergencies. He said savings also go a long way to foster a country’s economic growth and development.
“We have seen over the years that countries that have a consistent savings culture and hence a high savings rate are able to climb out of recessions faster than those with low savings rate,” he said. “Savings allow the necessary investment to improve a country's capital stock and its long-run growth trajectory.”
He said saving is important not only at individual level, but also at family and institutional level.
“Improved household savings will benefit individuals and ease the stressful levels of personal debt among consumers,” he said.
He cited the example of China with a gross saving rate of about 46%, and how that country has become a global economic giant with the world’s largest cash reserves at its disposal because it cultivated a national savings habit.
“Chinese have been consistently saving and building financial capacity for the future,” he said. “With such a huge pool of accumulated reserves (savings), Chinese companies are now able to invest in any part of the world.”
To help grow Ghana’s economy and to develop the means to deal with the problems like poverty and high interest, Nana Benneh reiterated the need to save and build our national savings.
“If more Ghanaians save through mechanisms such as savings accounts, endowments and retirement schemes, more capital will be made available to increase the productive capacity of the economy,” he said.
But how can Ghana as a nation, develop a savings culture?
Mr. Benneh stressed on the need to foster a greater sense of awareness among Ghanaians in the bid to make savings and investment simpler and more attractive. He also called on financial institutions to churn out products that offer rewarding incentives on savings.
He made this assertion during the launch of the Pure Save Campaign, designed to encourage a habit of savings among Ghanaians.
By making multiple deposits of GHC500 and maintaining a minimum balance of GHC500 in their Pure Save account between 3rd April and 2nd August 2017, customers stand a chance of winning a grand prize of GHC100, 000. The campaign will also see depositors earning a monthly investment reward of GHS 10,000. The five highest depositors in this campaign will win commemorative gold coins while several others will receive consolation prizes worth over GHS 40,000.
Stanbic Bank has over the years rolled out a myriad of savings and investment products that offer unrivalled financial security to its customers. These products include the Stanbic EduPlan, which allows parents to provide an uninterrupted quality education for their wards up to the highest level.
(c) 2017 Business and Financial Times - All Rights Reserved Provided by SyndiGate Media Inc. (Syndigate.info)., source Middle East & North African Newspapers