New scheme aims to teach school children how to manage debt
The number of credit cards in use in the Czech Republic has grown tenfold since 2001, while lenders are increasingly targeting low income households with offers of "easy money". All in all, managing debt is a relatively new experience for many Czechs, which is why the government is working on a scheme of personal finance education - for school children.
The Finance and Education Ministries are working on a joint plan to introduce "finance education" for Czech school children, Hospodarske noviny reported this week. Starting in 2009, pupils from the age of 11 should be taught how to manage their money. They will learn what credit is, how much loans can really cost and how to work out returns on investments.
An Education Ministry spokesperson said one of the main aims was to teach children to avoid taking loans they would not be able to repay. Meanwhile, Deputy Finance Minister Milan Simacek told Hospodarske noviny that the ministry wants all Czechs to develop a better understanding of what is today a complicated financial marketplace.
The volume of Czech household loans increased almost a third in 2006, and the International Monetary Fund and some banks have pointed out the risks of excessive borrowing by inexperienced consumers, particularly if an economic downturn were to occur. Others point out, however, that the outstanding debts of the average Czech are far lower than those of western Europeans.