The Royal Monetary Authority (RMA) has initiated Youth Ethics (YE) banking to promote financial literacy by encouraging ethical activities in schools.
Three schools and a volunteer group in the country have started the preparation process for the implementation of YE-Banking.
A former class VI student of Jigme Losel Primary School in Thimphu, Tshering Yangchen suggested the idea during the global money week celebration in 2016.
Jigme Losel Primary School in Thimphu, Arikha Primary School in Chukha, Wangsel Institute in Paro and members of Youth volunteers in action (Y-VIA) with the Youth Development Fund (YDF) will implement YE-Banking programme next month.
A set of activities inclusive of ethical values will be identified at the school, which will be used to assess the students for rewards. When they perform remarkably well in an activity, a teacher will reward the child with a dummy note carrying different bank points.
This will be taken to the banks for cash deposit in the students’ respective accounts. Each bank points carry a pegged value of Nu 2.
Jigme Losel Primary School’s principal, Choki Dukpa, said that volunteerism, astrology, national identity, loyalty, commitment, eco-literacy and waste management were among the many activities through which the students can earn dummy bank notes in the school.
She added that earlier, students were rewarded and assessed based on academic performance. “We want children to spend their money with dignity, which has been earned with effort, dignity, and respect. The child will not have the guilt to spend the money and could also instill a sense of ownership and responsibility.”
YE-Banking was officially announced at the global money week this year. The objective is to encourage financial inclusion of youth.
RMA’s head of financial inclusion and literacy division, Nangsi Dema, said that preparation for YE-Banking has started at schools.
She said that the pilot project would be studied for six months and would be replicated in other schools if possible. “We are not providing a large amount for children. The pegged value is minimum and a child might get very small amount at the end of the year. However, we are encouraging the programme to promote financial literacy, which is low in the country today.”
YE-Banking also aims to familarise children with currency notes, pass books, and bank transactions.
Annually, a YE-Banking committee will select 10 students, who will receive additional incentives such as certificate, bonus bank points, field trips and gift hampers. The YE-Banking committee will organise annual events, produce annual report, and look for financial support, which today is supported by RMA.
Nangsi Dema said that the financial sustainability of the programme is a concern. “The committee will look for donors. Even a small amount is going to benefit a large number of children and schools for a greater cause, which today is spent on other activities.”
Insurance companies in the country will also collaborate with RMA on the programme.
A small amount of premium would be collected from the YE-Banking members, which ensures accident insurance benefit for causalities of YE-Banking members.