Crown Prince graced AMBD Day

BERAKAS, BRUNEI-MUARA: People’s knowledge and understanding of financial matters need to be developed and improved towards creating a financially literate society, His Royal Highness Prince Haji Al-Muhtadee Billah ibni His Majesty Sultan Haji Hassanal Bolkiah Mu’izzaddin Waddaulah, the Crown Prince and Senior Minister at the Prime Minister’s Office, said yesterday. ©BRUDIRECT.COM reported.

Realisation of this aspiration needs strong cooperation from all relevant sectors especially government agencies, financial institutions including AMBD, His Royal Highness said in a sabda during the opening of the Autoriti Monetari Brunei Darussalam (AMBD) Day 2015 at the International Convention Centre.

“Financial literacy and access to finances are a global agenda that is receiving growing attention. It is identified as an effective and direct mechanism to tackle the issue of poverty and can encourage economic development of a country indirectly,” His Royal Highness added.

Revealing the initial findings of a national survey currently being conducted by AMBD in collaboration with the Centre for Strategic and Policy Studies (CSPS), His Royal Highness said only a few households in the country have good financial literacy with good financial habits.

The survey conducted on a total of 1,521 households found that 34 per cent has no financial planning for their household expenditure; 49 per cent does not have an active saving plan; and 24 per cent needs to borrow to finance their daily necessities. Whereas, 32 per cent does not know the interest-rate charged on arrears of their credit card.

The study also revealed that a financially inclusive society has a role to help lessen dependency on government, especially in generating jobs, increasing the level of education, insurance penetration, savings and life quality. All these contribute towards financial resilience, His Royal Highness said.

“Thus, the theme for the AMBD Day, ‘Facilitating Your Financial Future’, is very relevant. It takes into account the diversity of financial products and services that are increasingly becoming innovative these days and the importance of the public to get financial access as well as to gain basic knowledge on financial management.

“Financial management includes inculcating the habit of saving for the future, including financial protection for individual, family and assets through suitable insurance or Takaful plans,” His Royal Highness said, adding that an investment product is one of the alternative financial management methods that can be explored by those who have both the means and the financial know-how to do it.

Speaking on the AMBD survey, His Royal Highness said he was very concerned when he came to know that a large number of people do not possess adequate savings. It is not surprising that when things come very tight, some unwisely choose to get financial help from unlicensed sources. There are also some who fall prey to the get-rich-quick scams.

This kind of behaviour is dangerous. It can trap a person in the spiral of debts or put him in the risk of making losses without any protection from the law, His Royal Highness said, stressing on the importance of financial literacy and practising a wise and smart financial management in fulfilling the daily needs and for the future of the family.

This includes plans to own a house and preparation towards helping the education of one’s children. Make savings a culture or habit to accommodate lifelong needs, and this practice should be inculcated from younger age in a disciplined manner, His Royal Highness urged.

His Royal Highness also said that the initiatives of the Government of His Majesty Sultan Haji Hassanal Bolkiah Mu’izzaddin Waddaulah ibni Al-Marhum Sultan Haji Omar `Ali Saifuddien Sa’adul Khairi Waddien, Sultan and Yang Di-Pertuan of Brunei Darussalam such as the establishment of the Employees Trust Fund (TAP) and the introduction of the Supplemental Contributory Pension (SCP) Scheme are some of the efforts to provide social protection as well as to help public and private sector employees to make retirement savings to supplement their personal savings.

Financial literacy must also be inculcated among entrepreneurs in the SME sector. They also need access to financial facilities, including the micro-credit facility, His Royal Highness said. In this regard His Royal Highness raised concern that some of the SMEs are using finances that are not appropriate and what it is more worrisome is that sometimes they acquire finances from the unlicensed sector.

In this regard, His Royal Highness urged AMBD to provide a more conducive financial environment and enlarge access to financial products and investments to every layer of society.

His Royal Highness also called on licensed financial institutions to provide more saving-oriented products.

His Royal Highness declared May 28 as ‘National Saving Day’ to be observed every year.