Banks and financial institutions have been banned from delivering banking programs in Victorian schools.
Instead, there will be school-led programs to improve students’ financial skills.
The move comes amid concerns about the quality of school banking programs and tactics used by banks to develop loyalty at an inappropriate age.
There have also been reports about the inappropriate promotion of credit cards.
Education Minister James Merlino said there is very little evidence to suggest school banking programs teach students lasting habits to improve financial literacy.
“Victorian students deserve high quality financial literacy, free from commercial interests – that’s why we’re banning financial institutions from delivering school banking programs,” Mr Merlino said.
“The Victorian curriculum sets our expectations for financial literacy and that must be our focus. It is time to draw a line under this issue.”
Furthermore, interest rates offered through school banking programs are unfairly low, resulting in students missing out on compounding interest, a key benefit that comes with saving money and banking.
Consumer group CHOICE has been calling for the removal of banking programs in schools, such as the long-standing Commonwealth Bank Dollarmites program.
“CHOICE has never been able to find any evidence that programs like the Dollarmites have any impact on long-term savings habits,” CHOICE CEO Alan Kirkland said.
“Marketing programs like this have no place in schools. If we want children to develop financial literacy, this should be through evidence-based education, free from advertising. We welcome the Victorian government’s commitment to genuine financial literacy programs.”
CHOICE is now calling on other state and territory governments to follow Victoria’s lead.
Victoria’s ban on banks and financial institutions delivering school banking programs will be introduced from Term 1, 2021.
The state will introduce new teaching resources as well as practical information and tips for students on taxation and how to identify and avoid scams.
These resources will be developed in consultation with financial experts focused on what skills students need.
Financial literacy skills are taught through the Victorian curriculum from Foundation to Year 10 in subjects such as mathematics and economics and business. Students learn about financial decision making, as well as the rights and responsibilities of consumers.
