World Savings Day: A global reminder of financial prudence

By Esther Muhozi
On 31 October 2023 at 03:12

World Savings Day, observed worldwide on October 31 each year (though celebrated on October 30 in India), is a significant occasion dedicated to promoting the importance of saving for the future. Saving money is an essential means of preparing for financial emergencies and securing a stable income during retirement.

This day serves to educate people about the significance of prudent financial planning through various educational campaigns and activities.

Historical roots

World Savings Day’s origins can be traced back to the First International Savings Bank Congress held in Milan, Italy, from October 24 to October 30, 1924. It was officially established as an observance on October 31, 1924, and continues to be celebrated globally on the same date. The primary goal of this day is to enlighten people about different saving techniques and encourage them to embrace financial responsibility.

The significance of saving

Over time, World Savings Day has gained relevance and popularity, reflecting the growing importance of saving for the future. There is also a strong emphasis on instilling a savings culture, especially among young individuals, starting from a young age.

Rwanda’s commitment to savings

As Rwanda observes World Savings Day on October 31, it is noteworthy to mention the commitment of the Rwandan government. The Ministry of Finance and Economic Planning (MINECOFIN) has set an ambitious target of saving 23 percent of the country’s Gross Domestic Product (GDP) in the year 2023-2024.

The national savings rate is a vital indicator of a country’s financial well-being, reflecting how much money people, businesses, and the government save instead of spending. A high savings rate indicates financial stability and the ability to invest in economic growth.

In 2022, Rwandans managed to save 14.4 percent of their GDP, falling short of the 18 percent target. This shortfall can be attributed to factors such as the lack of a saving culture among many Rwandans, relatively low incomes, high living costs, and the impact of inflation on people’s ability to save.

MINECOFIN has outlined key policy actions to address these challenges. They aim to enhance the capacity of investment clinics to support small and medium enterprises (SMEs) in accessing alternative sources of financing.

Moreover, several awareness campaigns have been conducted by institutions like the Central Bank, Rwanda Social Security Board, insurance companies, and NGOs to promote a culture of saving among Rwandans.

Additionally, initiatives such as the issuance of treasury bills and bonds through the Rwanda Stock Exchange (RSE) and the automation of Umurenge SACCO are in place to facilitate easier access to financial services for rural populations.

To sum up, World Savings Day stands as a global reminder of the importance of financial responsibility and prudent planning. It underscores the significance of saving for future financial security and stability, encouraging individuals and nations to embrace the practice of saving as an essential part of economic well-being.

Rwanda’s commitment to this cause reflects the global aspiration to create a sound financial future for all.

World Savings Day, observed worldwide on October 31 each year is an occasion dedicated to promoting the importance of saving for the future.