Financial literacy is emerging as a strategic priority for Cyprus at both national and European level, with new initiatives planned during the country’s Presidency of the Council of the EU. The Central Bank of Cyprus, in cooperation with the Cyprus Financial Literacy and Education Committee (KEHAP), is preparing actions aimed at strengthening citizens’ financial knowledge and skills.

Financial literacy as a foundation of prosperity

In an article titled “Financial Literacy of Citizens as a Foundation of Prosperity”, the Governor of the Central Bank of Cyprus and President of KEHAP, Christodoulos Patsalides, underlines the critical role of financial literacy in fostering economic wellbeing and social cohesion.

He stresses that financial education is no longer a peripheral policy issue but a core element of economic autonomy, competitiveness and long-term resilience, both nationally and across the European Union.

Linked to the Cyprus EU Presidency priorities

As part of the Cyprus Presidency programme, built around the motto “An autonomous Union, open to the world”, five core pillars have been identified. One of them is Autonomy through competitiveness, within which the promotion of the Savings and Investments Union is a key objective.

Financial literacy is seen as an essential prerequisite for this agenda, enabling citizens to engage meaningfully with savings and investment opportunities and supporting broader economic growth.

A tool against inequality and insecurity

Patsalides notes that in an increasingly complex environment, where citizens are required to make critical decisions on saving, borrowing, investing and retirement planning, financial knowledge becomes a decisive factor for personal and collective prosperity.

According to the Governor, financial literacy goes beyond day-to-day money management. It is directly linked to reducing inequalities and strengthening citizens’ economic autonomy.

Evidence from international studies

The article cites international research by organisations such as the OECD and the European Commission, which demonstrates a clear correlation between financial knowledge and social indicators, including the Gini income inequality index.

Financial education is presented as a tool of social empowerment, allowing citizens to assess risks, understand their rights and obligations, and avoid excessive debt and financial vulnerability.

Financial literacy in times of crisis

Particular emphasis is placed on the importance of financial education during periods of economic crisis. International experience shows that societies with higher levels of financial literacy display greater resilience to economic shocks, as citizens are better prepared to adapt to changing conditions and make rational decisions.

A European challenge

At EU level, financial literacy is now firmly embedded in the strategy for the Savings and Investments Union, with the aim of channelling private savings towards growth, as well as the green and digital transitions.

However, the data cited from Eurobarometer 2023 are telling: only 18 percent of European citizens demonstrate a high level of financial literacy, while nearly half of adults lack emergency savings.

Cyprus strategy and institutional framework

For Cyprus, as a small and open economy, financial literacy carries even greater significance. Patsalides recalls that a National Strategy with four core objectives has been in place since 2022.

The establishment and operation of KEHAP in 2024 is described as the main vehicle for implementing this policy, coordinating initiatives and ensuring a structured and long-term approach to financial education across Cypriot society.

Financial Literacy #

Initiatives On Financial Literacy in Cyprus