Improving the financial literacy of Bulgarian citizens will also help fight misinformation about the euro area

Improving the financial literacy of society will reduce risky financial behaviour and the dependence of some people on the social system, while working to overcome misinformation related to the euro area, financial and economic issues.

This became clear during a discussion on “Financial Literacy as a Factor for Investments, Income and Eurozone”, organized by the Economic and Social Council of the Republic of Bulgaria (ESC), which was attended by the members of the Council – employers, trade unions and civil society organizations and key institutions and organizations involved in the topic. The discussion was part of the Communication Campaign for the introduction of the euro in Bulgaria and was attended by the Prime Minister Rosen Zhelyazkov, the Bulgarian Commissioner Ekaterina Zaharieva, the Minister of Education and Science Krasimir Valchev, the Head of the EC Representation in Bulgaria Yordanka Chobanova, representatives of the Ministry of Finance, BNB, NRA, NSSI, FSC, CPC and others.

In recent years, the euro area issue has been part of the substantive political conversation, but not a topic for debate. “It makes no sense then, when the nation should be confident that the introduction of the euro is only beneficial for the economy, to introduce a debate that manipulates people, breeds fears and manages fears in people,” said Prime Minister Rosen Zhelyazkov, who opened the discussion. He said attempts at speculation would be clearly addressed with all the state’s intolerance of such phenomena.

“People should know that Bulgaria’s membership in the euro area is proof to the world that Bulgaria is a strong economy and has a place at the table of the strong”, Bulgarian EU Commissioner Ekaterina Zaharieva said in a video address.

It is necessary to ensure that, before the country’s accession to the euro area, there is sufficient objective and verified information on all issues of concern to citizens and that it reaches them, ESC said.

“Bulgaria’s entry into the euro area will definitely lead to higher incomes in our country and to better opportunities for the Bulgarian economy. In almost all countries in the period before accession there were questions and doubts – what will happen to incomes, prices, inflation. The data to date show that in the years after accession, support for the euro area has been growing and reached 80%”, said the President of ESC Zornitsa Rusinova. Good financial literacy will not allow the public to be misled by false claims that eurozone membership entails economic collapse and impoverishment, she added.

According to a Eurobarometer survey, 55% of citizens report that they are often exposed to misinformation, which is also the highest share in the EU. More and more young people are falling into a debt spiral, lacking basic knowledge in finance and law, it became clear during the discussion. The level of financial literacy in Bulgaria is lower than in other EU countries, which is why targeted and effective policies and programmes are needed to raise it. The data are from the National Strategy for Financial Literacy of the Republic of Bulgaria [1], which sets out measures aimed at defining financial literacy competences in the areas of income and savings, investments, long-term planning, retirement and pensions, financial consumer protection, risks and insurance.

According to Trend Agency’s December 2024 Financial Literacy Survey, presented at the Forum, 73% of respondents do not save. Only 8% make investments of those who participated in the survey, while the share of those who firmly answered “do not invest” remains high – 90%.

84% rely on salary income alone, the results also show.

Another study – “Financial Literacy of the Population in Southeastern Europe” [2], Bulgarians manage relatively well with short-term management and control over their finances. However, they are less likely than other countries in the region to plan for the long term, relying mainly on the state to finance their retirement (78.6%). According to the 2020 OECD survey, a significant proportion of Bulgarians have saved (77.6% vs. a regional average of 67%), with savings held mainly in cash (62%) or bank deposits.

Low financial literacy is associated with ineffective or lack of involvement in the financial system with all the resulting negative consequences, a higher degree of risky financial behavior, with greater dependence on the social system, points out the moderator of the discussion Maria Mincheva – a member of ESC from the employers’ group. One of the most significant results of this is the lower quality of life of these groups. A financial culture not only improves the individual situation but also contributes to a more stable economy and society, especially with technological advances and the development of financial technology. It is important for Bulgarian citizens to be informed about new tools and platforms that can facilitate the management of personal finances, participants in the discussion said.

Despite the existence of a national strategy and numerous private initiatives, there is still no significant change among the population and especially among vulnerable groups. All the initiatives, discussions and consultations undertaken to raise the financial awareness of the society will give a real impetus to develop the Bulgarian economy, to accelerate the necessary reforms, to improve people’s incomes and to make financial literacy an asset for well-being.