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Financial Literacy from young – a step in the right direction for Malaysia



As the COVID-19 pandemic continues to be part of our lives in 2021 and going into 2022, Malaysian families are continuing to adapt their mentality, both physically and financially, to outlast the pandemic.

Financially, there has been an increase in cashless payments (eWallets, credit card & debit cards) due to fears of using physical cash, as well as an increase in online transactions. 88% of adults use cashless payments consciously since the pandemic began.

But moving to cashless does not mean adults are financially literate. In fact, financial literacy is still very low amongst Malaysians.

Financial literacy is using financial knowledge to set practical and clear financial goals which subsequently leads to better financial well-being. From a parents perspective, this means ensuring their kids are able to cope with the financial aspects of adult life.

When it comes to adult life, in a study conducted by the World Bank, only 36% of Malaysia adults were financially literate (Klapper, 2016). In an OECD survey, 13% of respondents in Malaysia rated their own levels of financial knowledge as very low and a huge 47% reported that their income did not always cover their living costs (OECD 2016).

Figure: Key Malaysian Financial Literacy metrics

An alarming high 28% of Malaysian working adults reported needing to borrow to buy essential goods (AKPK, 2018). This same report states that 18% of Malaysian working adults have zero savings as of 6 months pre-COVID.

Seeing that only 36% of working adults are financially literate, the need to educate the future generation is an absolute must.

But how can you do that in a world that has gone cashless and does not allow children to sign up to their own cashless payment solutions. Children are a cashless underserved, who still need to use cash notes – which can come with the hazard of COVID.

What is required is a cashless solution that helps parents ensure that their children learn money management skills, and is child-safe. A tool that provides a safe introduction to cashless for children.

Vircle is a child-safe solution that helps parents raise money-smart kids.

The Vircle app paired together with a child-safe VISA Prepaid Card gives parents a tool to help them educate their children on key aspects of money management. With Vircle, children learn to earn, spend and save with guidance from their parents.

When children spend using the Vircle child-safe Prepaid Card, parents receive real-time notifications of the spend. This enables them to provide spending guidance and advice if and whenever required.

The Vircle App comes with the ability to set savings goals. By using this, children will learn the importance of saving and be able to experience first-hand the benefit of saving for those more valuable items they would otherwise not be able to afford.

In addition to setting and achieving savings goals, the app also comes with the ability to set children activities and objectives to meet. These are called missions. A parent can set any variety of activities and objectives, for example achieving an A for a maths test, or simply doing chores such as keeping bedrooms tidy. When setting missions, parents can also set rewards that children will receive – motivating the kids to learn good habits from a young age.

By using Vircle, parents can ensure that children are able to experience using money safely, during the era of COVID, and that this experience really does teach them the value of money.

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