Being financially literate means understanding how skills such as money management, budgeting, and investing can be used to make effective financial decisions. The earlier these skills are adopted in life, the greater the opportunity to accumulate wealth. Unfortunately, the education system is sorely lacking in teaching the financial literacy and application skills we need to succeed, and we are still learning how this affects the economy more broadly.
Changing providers and deciding on the best mortgage rates – these are the kind of decisions most people will come across. But not fully understanding how everything works can cost a significant amount of money, according to the latest research. The National Council of Financial Educators (NFEC) found that, on average, American adults estimated they lost $1,634 in 2020 due to a lack of money management skills. Extrapolating from these numbers, the lack of knowledge cost US citizens about $415 billion in 2020.
Given that in 2018, respondents estimated an average loss of $1,230 for that calendar year, this indicates that an increasing number of people are potentially missing out on the opportunity to build a financially stable future. With the increasing popularity of Web3 and cryptocurrency among the next generations, teaching kids finance skills and financial application is becoming more and more important.
Learn financial literacy with crypto
Many hope that the rise of cryptocurrencies will eventually help solve the growing problem of money mismanagement on an individual and institutional level. With the flexibility offered by blockchain technology, many different use cases can be adopted to achieve this. One such use case is teaching kids about finance and being financially responsible early on.
Banano (BAN) is a freely distributed “potassium rich” cryptocurrency project launched in 2018, running on the Directed Acyclic Graph (DAG) architecture. The network is tactile, immediate, and sustainable, making it an ideal environment for cryptocurrency learning and finance.
The project’s primary goal is to provide an accessible educational method for entering the complex world of digital assets. They provide intuitive tools, informative workshops, and helpful guides in such an easy-to-understand manner that financial expertise and massive computing power are not required.
Banano has several programs that have evolved from its ecosystem, and one of them aims to address and improve the issue of financial illiteracy. With Banano in the classroom, teachers can leverage blockchain technology to teach students financial literacy, application skills, problem-solving skills, and individual and group accountability through crypto and rewards.
One of Banano’s success stories in the classroom revolves around Canadian teacher Mr. G who uses the software as a points system to reward students in his class for being respectful of their surroundings, completing certain tasks, and staying focused. Mr. G distributes the Banano throughout the week, and “buys it back” in time for the bonus cycle again for the following week.
To save or not to save?
Aside from feeling rewarded, students can spend their hard-earned Banano at Mr.G’s Banano Store. Teacher accepts BAN codes for pizza, extra time outside, toys, games, school supplies, computer time, and more. This reward system introduces children to the concept of earning, saving and spending.
It also teaches conflict resolution, since purchases for the main group must be made with 100% consent of the group. Students must discuss the possibilities and eventually come to an agreement. For example, does everyone want one candy bar today, or should they save enough and collect their money for pizza next week?
Teaching children about financial responsibility also touches on many other areas of development. Mr. G mentions that before the program was implemented in 2019, he was burnt out due to misbehavior in his class. Since then, things have reportedly improved a lot, as reported in the Daily Peel news site curated by the Banano community:
“Banano in the Classroom has been a huge success and has significantly improved behavior, overall class cleanliness, and class morale. Students are very excited to take advantage of BAN$ for weekly prizes. Some groups are even saving Banano from week to week to save up for prizes Better. It helps connect many of the financial literacy skills I wish I had learned at the age of nine.”
Banano aims to eliminate the high barriers to entry that plague most other crypto projects. The easy-to-use crypto platform provides the infrastructure for people of all ages to learn about personal finance, group economics, asset management, application skills, and other valuable financial applications, making it an influential use case for cryptocurrency.
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