The highly worrisome findings of a study on financial illiteracy amongst Cypriot undergraduate university students were presented recently before the Board of the Limassol Chamber of Commerce & Industry by Cyprus University of Technology professor Dr. Panayiotis Andreou. 

The study, conducted by Dr. Andreou in cooperation with Dr. Dennis Philip of Durham University Business School showed that there was a serious problem amongst undergraduate university students with regard to their understanding of even basic economic and financial terms. In the framework of the study, a total of 562 undergraduates throughout Cyprus were presented with four simple questions, on interest calculation, the impact of inflation on the cost of living, the purchasing value of money and the dispersion of investment risk. Overall only 17% of participants answered all four questions correctly, a result that requires the immediate adoption of measures which can tackle this problem effectively.

The challenge ahead of us, Dr. Andreou noted, is to ensure that we have citizens who are adequately educated and mature enough from a financial point of view. To that end, one has to admit that financial illiteracy represents a serious social problem, which assumes broader proportions when financially illiterate individuals are called upon to decide on financial issues that related directly to their own well-being. The finding of the research, he continued, should leave no one in doubt that economic and financial education is essentially the cornerstone upon which to base a proper attitude vis-a-vis financial matters. Without this knowledge citizens will not be in position to identify possible illegitimate or illegal practices on the part of financial institutions, which of course will be very much to their detriment.

The President and the Board members of the Chamber showed much interest in the study and assured Dr. Andreou of their readiness to contribute towards finding appropriate solutions to the problem.