Visa supports financial education for youthMore by Visa Europe - Back to the Autumn 2016 issue
The global payments business partners with Junior Achievement Europe to create innovative e-commerce and personal finance programmes. Tom Idle reports…
The digitisation of our global economy has very quickly transformed how we think about and use money. Paying for goods and services online, spending our salaries in stores with the swipe of a card and transferring cash in virtual environments has made lives easier and the handling of ‘real’ cash a thing of the past.
Yet the financial literacy and understanding of how money works among young people has not necessarily kept pace with the ever-evolving digital economy – even in the most developed nations.
Keen to support the education of young people and play a leading role in reversing this trend, the global payments business Visa has stepped into the breach, partnering with Junior Achievement (JA) Europe to find solutions in boosting financial literacy and the employability of young people across Europe.
“When our chief executive joined the business two and half years ago, he challenged us to think about how we could generate more social value, and business value, from our programmes,” says Nick Jones, Visa Europe’s head of corporate responsibility. “Previously, our CSR initiatives had a wide focus on how we could help young people.
“But we knew that equipping them with a financial education would help them land better jobs or have the confidence to start their own businesses would be a valuable role for us to play.”
To help bring that vision to life, Visa has sought the expertise of JA Europe, an organisation founded to provide young people – from primary school age to university – with entrepreneurial experiences that build the skills and competences they will need to succeed in a global economy.
In fact, the two organisations have been working together since 2012 when they jointly launched a financial literacy programme to support school children in Romania. Then came the Entrepreneurial Skills Pass, designed to give young people a unique certification of their entrepreneurial experience and knowledge. It acknowledges their participation in the JA Company Programme, where they learn what it is like to run your own business, all within the safety of a school environment where they have the confidence to make mistakes and learn as they go.
During the school year 2014-2015, the Start-up Incubation Challenge kicked off in the UK, Denmark, Romania and Spain to nurture young start-ups. Around 530 university students were supported by 40 Visa staff volunteers to develop more than 100 new business ideas. It has been a fruitful partnership with both parties bringing different skills and strengths to the table. “Despite the scale of our brand, we have a fairly small employee footprint in Europe, with only 1,500 employees,” says Jones. “We do have lots of our volunteers going into schools, but we can’t blanket the country or stretch far into Europe. But JA can give us that reach.
“Also, we are a payments technology business. JA are the established experts in devising great programmes for financial education. We needed to partner with an equally well-known brand in their field and use our shared vision to equip young people with the tools to thrive. It’s a perfect fit because our visions are identical,” he says.
The trend for the private sector playing a role in what has traditionally been a public sector-only domain – the school – is one that is ever evolving. “Building partnerships between businesses and education authorities is changing,” says Diana Filip, deputy CEO of JA Europe. “When I joined the organisation back in 2004, there was very much a sense of ‘business does not belong in the classroom’ and we have had to push hard to make sure governments understand the need to change.
“Yes, we need to empower teachers, but businesses have a key role to play too.”
Of course, giving young people an insight into the world of work through business is one thing. Giving them the right education that is going to be useful and lead to a job, is quite another. And that is exactly the challenge that Visa and JA’s latest initiative is designed to tackle. What are the skills and competencies that businesses need from the next generation of young employees that are currently missing? “Take something like the automotive sector, for example. Teachers are way behind in understanding the developments in digitisation and technology that have taken place in that industry. Companies are saying that students entering into business are not equipped to get up to speed with how they operate,” says Filip.
It is not just in the automotive sector that there are skills gaps. The wide-ranging survey, launched to coincide with?European Money Week?in collaboration with the European Banking Federation, the Organisation for Economic Co-operation and Development and the Vienna University of Economics and Business, points to a range of issues. Of the 455 respondents from the business community, 95% said that young people are not equipped with the financial skills they need to start their working lives.
Across all European regions, 59% believe that ‘financial planning’ and ‘budgeting’ are the most needed skills for business. And just 19% said that their country’s education system was doing enough to reverse the trend.
In a report containing the full survey findings, there are also a number of case studies that offer inspiration and ways to fill the missing gaps, including the aforementioned schools programme in Romania. Known as MoneyIQ and MoneyOnline, Visa and JA Romania have kick-started two large-scale and long-term financial education programmes that have delivered offline and online learning modules to more than 800,000 young people in the last five years. Through a combination of face-to-face training sessions and two main e-learning platforms, students have been given a chance to learn about personal finance and e-commerce, and teachers have boosted their ability to apply financial education in an interdisciplinary way across all subject areas.
“Electronic payments are changing the way that we pay and are paid at an unprecedented speed. This pace of change makes it all the more vital that we equip young people with the money management expertise they need for work and life in a digital world,” says Jones.
Filip agrees and wants to see financial education given at even young ages. “Talking about the economy, what Mum or Dad are doing and how money flows is important even at primary school age,” she says. “My son came home from school after experiencing a programme like that and said, ‘Mummy, now I understand why you can’t buy me Lego Star Wars every day, because there is a tax person who takes part of your salary to pay for schools that we can go to for free. That made me so happy.”
The work of Visa and its partnership with JA Europe is a great example of how companies can use the power of their brand to make a difference where it is needed most – and in a way that aligns with its overall growth strategy. By aligning with an organisation that can deliver the expertise required on the ground, Visa has found the right partner that shares its mission to really make a difference.
By Guendalina Dondé, Senior Researcher, Institute of Business Ethics
Nurturing new talents is essential to business success. This initiative promoted by Visa is aimed at equipping young people with the set of skills that are required in the workplace, bridging the gap that is often perceived between the education system and the business world. It is a good example of how business can engage with society in a positive way that benefits both parties: companies will be able to attract more skilled young employees, who in turn will acquire the expertise they need to start their career successfully. Moreover, it allows Visa to support its more vulnerable young customers to make better financial decisions, minimising the related risks.
Points to Note:
• The engagement of Visa with society is not limited to the young people targeted, but it involves a partnership with an organisation – Junior Achievement Europe – that could improve the impact of the initiative.
• The success of this initiative is grounded on the engagement of Visa employees: around 40 Visa staff volunteered to support about 530 university students to develop more than 100 new business ideas.