Peru Sees Financial Literacy as Key to Middle Class Growth

On the heels of 10 years of growth of Peru’s economy, the nation’s middle class has seen greater access to credit and, as a result, higher levels and risks of debt.  With an additional 6% GDP growth forecast for this year by analysts, it is widely anticipated that many Peruvians will continue to desire higher end goods and services, which increasingly are being paid for and financed with consumer debt.  At the same time, there is fast-growing concern among Peru’s government leaders that these consumers lack the financial literacy to budget and successfully navigate their personal finances.

In response to this phenomenon, the Peruvian government is moving forward with support for financial literacy initiatives.  Peru has experienced growth in financial education programs launched by the country’s bank regulator, the SBS, five years ago.  SBS also now provides secondary school courses in financial education and operates a financial literacy web portal to spark even greater awareness and financial education among the populace.

The financial literacy developments in Peru are not unlike those taking shape in neighboring countries.  Ecuador, for example, took steps last year to restrict major retailers from issuing credit cards in the hope that this would slow the growth of consumer debt in the country.  But other nations are instead assuming that consumer debt will continue to rise and, therefore, that the focus should be on educating consumers and best arming them with the financial skills and resources that will enable them to manage their personal finances most effectively.

We will continue to watch closely the regulatory and programmatic developments in Peru and the broader South American region.  There’s no doubt that the next 12-18 months will continue to manifest significant financial literacy initiatives in this region and beyond.