YEREVAN, June 19./ARKA/. More than 5,722 customers have opened a bank account in one of the five Armenian banks participating in the financial training programme launched in the country by the European Bank for Reconstruction and Development (EBRD) in December 2012.

In the first four and a half months, over 12,800 people have been provided with a tailored financial consultation, which has resulted in US$ 1.5 million savings being deposited in a formal institution, EBRD reported to ARKA.

“This is the most recent financial education project of a series the EBRD successfully carried out in several countries of operations,” the source stated.

The projects, which are funded by the Bank’s multi-donor Early Transition Countries (ETC) Fund, aim to strengthen the financial inclusion of remittance recipients in countries where a large proportion of the population depends on money sent home from abroad, and yet financial education is poor and the flow of savings to the formal financial sector is low.

In Armenia remittances accounted for 23 per cent of national gross domestic product (GDP) in 2010 and were an estimated US$ 824mn in 2010 .

Remittances sent via money transfer systems, such as Western Union, UniStream and Anelik are collected at bank branches by family members or friends that often do not have an account.

In 2012, the project implementing agency DMA partnered with Armenian retail banks including UniBank, Converse, ACBA, VTB and ArmeconomBank, and identified the branches that handle large numbers of remittance transactions. DMA trained 20 financial advisers to work in the busiest bank branches in terms of remittances. Advisers intercept remittance recipients inviting them for a free one-on-one, personalized financial consultation on how to manage their finances. “I think this program brings not only a willingness among people to save, but an understanding in how to do it”, said Armen Isahakyan, Financial Adviser from UniBank, Yerevan.

Survey results indicate that 50 per cent of those with savings were choosing to keep their money at home. The financial education project is helping to mobilize these “under the mattress” savings into the formal financial institutions so that they can, in turn, be used for productive purposes and development.

The project will run until October 2013.—0-