20 years! In November 2005, I founded a+b=3 in Hong Kong. Our training programmes have directly impacted 6,000 people and approximately 80,000 through the trainers we’ve trained to deliver our workshops. What the numbers don’t show is the real impact and everything I’ve learned. For our 10th anniversary, we organised an exhibition about money (the videos are still available on YouTube). For our 20th anniversary, I’m sharing some of the key moments of this journey throughout this month. These 20 years have profoundly challenged my knowledge and assumptions about finance.
Key moment #1: I love going back to the place where we ran a training and discussing with people. Once, in Cambodia, what I heard was not at all what I wanted to hear. One participant had taken our lessons so much to heart that she had saved money and was lending those savings to her neighbours and friends with high interest. Could we consider this training a success, with a positive impact? Was this participant ‘financially literate’? Can we become financial literate only at the expense of the others’ financial illiteracy?
Key moment #2: At the end of a train-the-trainer workshop in Phnom Penh, a participant stood up and declared, rather solemnly: “Thank you for teaching me to be stingy. I’m going to stop going out with my friends and I’m going to start saving.” I suddenly became aware of the social and economic impact of what I was teaching. His spending cut meant loosening social ties and an income loss for businesses somewhere in Phnom Penh. What if all ‘financially educated’ people did the same? What impact would it have if we all drastically reduced our spending? What is the true purpose of financial education?
Key moment #3: On International Women’s Day, March 8, 2008, Lehman Brothers Hong Kong invited me to give a motivational speech on financial literacy to their young executives. In retrospect, it’s quite ironic. What struck me was that at the end of my brief presentation on the importance of managing one’s money (which seemed self-evident to me, since I was speaking to the crème de la crème of the financial world), a number of executives came up to me, somewhat embarrassed, and in hushed tones confided in me about their difficulties managing their income and the stress related to their debt. Financial literacy programmes are almost entirely funded by the financial sector and primarily target low-income individuals… What if we reversed that logic?
Key moment #4: Far from the investment bankers of Hong Kong, a few years later, in a village in West Africa, I was sitting with a young woman with a very low income who was struggling to make ends meet… and wasn’t convinced by my budgeting advice. She started listing her expenses: the list was precise, down to the number of bars of soap and the kilo of rice. Of course, she managed her expenses; she knew them by heart – she constantly had them on her mind. Why come from so far away and ‘teach’ her how to choose between a bag of laundry detergent and a bottle of cooking oil? 1) Financial education will never replace a living income. 2) Shouldn’t the logic of financial education be reversed: those who are struggling have more to teach us than those who don’t have to worry about money.
Key moment #5: During a training session for migrant workers in Hong Kong, whose main theme was savings, one of the participants broke down. She cried and ‘confessed’, as if it were a sin, her inability to save. Except that… with her salary as a domestic worker, she supported her three daughters, all of whom were pursuing higher education in the Philippines… of course she couldn’t save. Financial literacy training revolves so much around saving (for funding and political reasons) that not saving automatically means mismanaging one’s money. The concept of ‘dissaving’ or using one’s savings, is never addressed. Long-term savings simulations never take dissaving into account and instead present a constantly growing nest egg. The underlying message: anyone who can’t grow their savings isn’t managing their money well. Does financial education contribute to financial exclusion?
Key moment #6: a+b=3 was born during the microcredit boom and its educational component: financial literacy. After the 2008 crisis, the enthusiasm gradually faded, and funders shifted their focus to women’s empowerment programmes. So, we were asked to develop financial education programmes for women only… even though preliminary interviews indicated that the women lacked decision-making power. It wasn’t a problem of knowledge, but of power dynamics. It was quite clear that after the training, the participants wouldn’t be managing the family finances, which were solely controlled by their husbands. Why not offer training for men, and then for couples? Funders’ priorities too often dictate the actions of organisations on the ground.
Key moment #7: One of the biggest difficulties I’ve faced is that the trainers who participate in our train-the-trainer programmes… don’t manage their own money either. The first day of training is therefore dedicated to giving them the basic techniques and the motivation to track their income and expenses and create a budget. And the following days are spent showing them that what they’ve just learned for themselves… is probably not the answer to their participants’ problems. It is, in fact, the trainers’ ability to adapt these basic techniques to the specific problems of their participants that will make all the difference. It’s “financial empathy” that sets trainers apart: the best trainers are those who, even if they earn a fixed income and have a permanent contract, know how to put themselves in the shoes of their participants who have no idea if or how much they will earn tomorrow. A “one-size-fits-all” and universal approach to financial education is an illusion.
Key moment #8: At the very beginning of a training-of-trainers programme on entrepreneurship, when I ask the question, “Who has ever set up a small business?”, whether in Kinshasa or Phnom Penh or elsewhere, it’s rare that more than one or two hands go up. So, once again (see previous post), I dedicate the first part of the trainer training to giving them a taste of creating and managing a micro-enterprise. Entrepreneurship is all the rage among funders. However, it’s not that simple, because generating income necessarily involves generating expenses… On the one hand, we’re training a community to spend less, open a bank account, and save… and on the other hand, another programme is encouraging that same community to create a business… thus encouraging them to spend. If this community lives in a closed circle, it becomes absurd. Finance is not a science… it’s a network of transactions. Financial and entrepreneurial education cannot be individual; it must be social.
Key moment 9: I was once contacted by a volunteer who was about to leave for Indonesia to lead an entrepreneurship training programme for women in a village. She wasn’t quite sure how to introduce key concepts like the 4 Ps. Her project didn’t consider any of the realities on the ground (families buying on credit without paying, all the women selling the same product as their neighbours, a closed-loop economy, the lack of bookkeeping, etc.). What if the organisation funding this mission had invested in creating market opportunities for this community, or given the equivalent amount (plane ticket, hotel, etc.) to these women – letting them decide what to do with it? Financial education is not the solution to structural financial difficulties.
Key moment 10: In Cambodia, I quickly realised that one of the major difficulties in managing the family budget was… the numerous wedding invitations. During training sessions in Burkina Faso, it was the expenses related to funerals that sparked debate. And elsewhere, it was the delays in salary payments… And corruption, which is rarely discussed but has a real cost. Financial literacy programmes, which frame money management as an individual responsibility, are unable to provide adequate solutions to these societal problems despite their significant impact on family finances. Similarly, they advocate for “rational” choices… but what about ethics? Shouldn’t ethics be at the heart of financial education?
Key moment 11: I could go on, but I’m saving other stories for our 30th anniversary 😊! In 20 years, the world has changed: informal shops in Laos now accept QR code payments, all tuk-tuk drivers have smartphones, and domestic workers in Hong Kong are interested in investing in cryptocurrencies… Yet – based on statistics and my observations – one thing hasn’t changed, despite the millions invested in financial education and its designation as a national priority in most countries and that’s household debt. But who would be surprised, given that financial education is largely promoted by the financial institutions that provide loans, and that household consumption is a key component of GDP, our main economic indicator? Money is a social tool, and financial education should help us understand the complexity of our transactions, their social impact, and the power dynamics involved, and promote ethical behaviour.
