Governor of the Reserve Bank of Malawi (RBM) Charles Chuka has advised people to invest in assets, saying they risk losing the value of their money to inflation if kept in cash.
Speaking at the launch of the National Financial Literacy Week in Mzuzu, Chuka said inflation will continue to be on the rise in the country until mid next year when it could start to slow down once again.
He therefore advised people to invest their money in assets as a way of preserving its value in the wake of inflation.
“Money will always lose value through inflation. And looking at the sharp rate at which inflation is rising in the country, it is essential that we all know how to manage our finances. We can increase or at least preserve the value of our moneys through investments,” said Chuka.
Chuka projected that inflation in Malawi will rise from the current 24.7 to 27 percent in February 2016 but expects it to start going down again later in the year.
He said the government is working hard to improve the economy and reduce inflation, at least “by the same time next year”.
“We are expecting an improvement,” he added.
Chuka also bemoaned the low savings rate in the country which currently stands at slightly over 30 percent, saying it is the lowest in the whole southern African region.
He attributed the problem to low financial literacy levels among consumers in the country who he said barely have knowledge on how to utilise products and services offered on the financial market.
He called on Malawians to utilise the Financial Literacy Week to educate themselves on financial matters such as insurance, micro financing as well as treasury bills, among others.
Taking his turn, Deputy Minister of Education Science and Technology, Vincent Ghambi, hailed government for choosing his ministry to be one of the implementers of the Financial Literacy Programme initiative which was launched in 2013.
“It pleases my ministry that financial literacy has been incorporated in the new secondary school curriculum which commenced in September this year and is taught in over eight subjects,” Ghambi disclosed.
He said the move is set to increase awareness among Malawians on Financial products, apart from ensuring their financial inclusion, among other things.
This year’s Financial Literacy Week – which took place last week, was commemorated under the theme ‘Budgeting and saving: foundation to financial freedom”.
During the week, public meetings were undertaken in all parts of the country to sensitise members of the public on various financial related matters, including on how they can lodge complaints to financial institutions in order to get adequate and required help.