• 2 days ago
Read the full story here:

See more videos at https://gulfnews.com/videos
Read more Gulf News stories here: https://bit.ly/2HLJ2km
Transcript
00:00So on an average in the UAE, you've got about three and a half credit cards in your pocket.
00:04It's very easy to get a credit card alongside your salary and so many other options that
00:09are available and tempting to get those air mile cards and grocery cards and whatnot.
00:14But the scary part is that about 70% young earners in here, they revolve on their credit
00:21cards. That means they're paying only 5% of what they're supposed to pay and end up paying about
00:2742% annually as interest. It's very lucrative for the banks, but imagine what it can do to their
00:34pockets.
00:48With me in the studio is Purvi Manot, who is the CEO of Say, which is a UAE-based tech company
00:54that actually has a platform that helps people reach their financial goals. I think that's
01:00super interesting and I know you're going to talk about this throughout the discussion,
01:03but before we get started, how are you?
01:06I'm doing great and it's a pleasure to be here. A very exciting topic. Let's talk about
01:13in this part of the world.
01:15Yes, yes, I agree. Honestly, before we get into it, I want you to tell me more about
01:20because I'm really interested in the sort of platforms you offer users and how you help
01:26these users achieve their financial goals.
01:29We are a fintech app. We are currently based in the DIFC and in our last 12 months of operations,
01:35we have helped over 50,000 users to get started with their savings journey and ASET. The platform
01:40is pretty simple. The purpose of creating this was how do we make savings really simple,
01:46effortless and rewarding for our users and at the same time tie it to their lifestyles.
01:53We've got a lot of banking products that exist in the market, which help you save,
01:59which give you a saving account, which are current accounts in itself.
02:02We aim to be the secondary help for the users when they want to budget
02:07for the goals that they want to achieve. So you want to go on a holiday, you want to save up for
02:12your kid's education. There's a large expense which is coming up. So why don't you start
02:16putting them into pockets? And we do the heavy lifting for a whole lot of automation and
02:22gamification to keep you on track. Amazing. I find that fascinating because I think it's one
02:28of the hardest things for people to do in life is to save up to budget, to always account for
02:35the future. And I think a big part of it has to do with the literacy, like the financial literacy
02:40that people have these days. And that's the core of our discussion today is financial literacy.
02:47And before we get into the discussion, I wanted you to define what financial literacy is and
02:54how is a person, like how do you qualify a person financially literate?
02:59So financial literacy can be seen as a combination of two things. One, how well do you understand
03:05money? And the second piece is how well are you able to execute the things that you must be to
03:11achieve what you want in your life? So while a lot of times we restrict our conversations to
03:18you must be knowing how are you spending? How are you supposed to save the kind of investments
03:24that you make? But it is also important to understand that what you should not be doing
03:28with your money and how you should be executing it right. Not being that FOMO investor or not being
03:34that person who just wants to live it up. Both ends are extreme. Right now in the UAE,
03:42the rate of saving specifically is at about three percent, which is way lower.
03:50Ministry of Finance has this very cool initiative called saving awareness initiative where they want
03:56people to understand their money better. And I'm sure that's where if there's a government level
04:02impetus, it is very important for residents in here to be learning about how their finances look
04:09like, how should they be executing the kind of platforms they must be on. And so on an average
04:16in the UAE, you've got about three and a half credit cards in your pocket. It's very easy to
04:20get a credit card alongside your salary and so many other options that are available and tempting
04:26to get those air mile cards and grocery cards and whatnot. But the scary part is that about 70
04:33percent young earners in here, they revolve on their credit cards. That means they're paying
04:38only five percent of what they're supposed to pay and end up paying about 42 percent annually
04:45as interest. So very lucrative for the banks. But imagine what can do it can do to their pockets.
04:51Oh my goodness. That's a shocking statistic for me because I mean, I do have people in my life who
04:56are still paying off credit card debt that they've had since five, six years ago. And every year it
05:05accumulates because there is that interest rate as well. So it is a higher number. And I find that
05:10shocking. I find that absolutely shocking. And alongside that, you've got the options to get
05:16more of buy now pay later. So smaller luxuries, the instant gratification just comes in there.
05:22You all have a car because it's easier to commute in Dubai if you've got a car. So on the auto loan,
05:28real estate is on the rise right now. So you've got those mortgages. It is very difficult to squeeze
05:33out any extra penny right now if you're not doing your credit right and if you're not planning your
05:38finances in a structured manner. Okay. So you mentioned like understanding their money and I
05:44think that's key. How can someone actually achieve this financial literacy or that that notion of
05:53understanding your money? How can someone achieve that? I mean, baby steps, but what are some
05:58like basic steps that people can do to reach that goal? Right. So first starts with what are your
06:05goals. The moment you are able to define your goals, you're also able to go back and do the
06:11math that what should your savings look like? What should your spending look like? And what
06:16should be the money that you must be looking at for the future purposes? Now, when we specifically
06:21look at spending, that's where understanding truly begins because that's present.
06:27That's in your control. Right. So one is how are you doing with your money as soon as you get paid?
06:34What do you do with it? The second piece is when you are spending on a monthly basis, how are your
06:40spends looking like? Are they a combination of only essentials plus needs and plus some experiences
06:51that you want to buy? Or is it the extremes that you are spending it on? Are you just burning it
06:57away? It's your call. So that kind of understanding with respect to how you're doing with your money
07:04comes in with either Excel spreadsheets, doing the math back that how it is looking like with
07:12whole lot of financial apps that you have, including Save, where you can connect your bank
07:16accounts, find consolidated insights about your spending behavior, what categories are you spending
07:22on, and then use those insights so that you can optimize your spends on a daily basis. Why do you
07:28people find it hard to save or to budget or to stick to a budget? I think because I do this a lot.
07:35I'll put a budget for like a trip or a holiday or a weekend away or even an outing and I will
07:41always surpass that budget. It's as if it doesn't exist. Why do you think that's difficult for
07:47people to stick to that? I think good things are always difficult. You want to lose weight? Yes,
07:51it's very difficult. Having a routine is very difficult and so is being responsible about your
07:57money. Today we live in Dubai and UAE in general is a consumptive geography. So everyone is coming
08:03in here to live up their lives, have fancy cars, a good house and all the luxuries that are just
08:12available to spend on. So amidst that glitz and glam, I'm sure it's very easy to lose control of
08:17our finances and that is what must be avoided and that's where the mess up starts. I think the next
08:24piece is, we're driven by two key things. One is FOMO because everyone around us have got those
08:32great lifestyles and we just want to imitate their Instagrammable lives. But the moment we go
08:39a little further in our journey, we realize it's not sustainable and maybe sometimes it's just too
08:45late. The second piece is, and this is quite prevalent in this part of the world again,
08:51is being a FOMO investor, which certainly means that you want to get rich really quick. So you've
08:59got money in your hand, you want to skip that entire process of saving and then investing
09:05responsibly and just want to trade. You want to buy that next coin. There's a lot of craze and
09:10that's where we keep on being on this spectrum of being extreme spenders or in this race of getting
09:19rich pretty quick and everything in between looks really difficult. And so you basically everything
09:25in between just falls through the cracks and it just it's not sustainable. Another aspect of
09:30financial literacy that I feel like is worth mentioning is people who live here but support
09:35families home. I think it's one of the most difficult situations. I think also because it
09:41comes with a lot of guilt. A lot of people that live here feel like they need to send all their
09:46money home when really that's it's not fair and it's not necessary. But I wanted to get your
09:51insight on that. Like how can people do this wisely? Yeah so there's no right or wrong answer
09:57on those fronts. It's your personal choice and your personal responsibility. But yes we are living
10:02in a world where the cost of living is pretty high. The essentials are not cheap. So you should
10:08be in a situation while you are paying for those essentials, you must be setting aside something for
10:13your emergencies. Interestingly in the UAE there are about 50 percent people who do not have any
10:20emergency savings. So the saving amounts are less than $10,000. So that means you're you're sitting
10:27on something that you cannot sustain for even three or four months or lifestyle that you cannot
10:33sustain for even three or four months if something goes wrong. So it is very important that while
10:37you're supporting families it's essential you must be looking at the buffers that you need in life
10:43for your own family in here and the needs that you're going to have for for surviving. Okay you
10:51know some would beg to differ that you have to be earning a certain amount of money or to be of a
10:55certain status to be actually able to achieve what you're talking about. Is that true? Yes and no.
11:03Yes because we've got a set of consumers in here which which do not draw a lot and their purpose
11:10of being here is to be able to support their families back home. But you don't need a minimum
11:15amount to get started. Your needs and wants actually keep on creeping in depending on
11:24how much more you earn. So if your essentials are taken care of even if you're drawing
11:30in a scenario where your essentials today cost about 6,000 dirhams, your remaining 4,000 is
11:36something that your it's your choice what you want to do with it. Do you want to buy an experience?
11:40Do you want to live a lifestyle? Do you want to spend it on something which is going to build
11:45value for you in long term? It's absolutely your choice. You can even start saving or investing with
11:51as low as 10 dollars. So nothing wrong right? Interestingly there is a TikTok challenge which
11:57is going on right now has become really popular where people have started to put money in envelopes
12:03like one start with one dollar a day next day it's two dollars. Oh interesting. Until you reach
12:09hundred dollars a day you just keep on doing it. 40 days good time for building habits.
12:15Hundred dollars by the time that you reach that amount you've got 20,000 dirhams saved
12:20and that's something that we've just deployed on the app if you want to do it digitally. But
12:24it's no smaller no amount is small. It's about your habit and your motivation to keep doing
12:31the right things. Okay so me and you are both women and I think it's something to address. I think
12:37when it comes to financial independence and literacy again we go back to that buzzword.
12:43I think it's in my opinion I feel like it's something that women tend to lack mainly because
12:50we have been dependent either on our parents or our spouses. I think there is an increase nowadays
12:56and I think I've seen a lot of women become more independent and you know taking control
13:01of their lives a bit more but you still have a lot of women who are independent in their jobs
13:05but maybe not financially. Do you feel like this is an area that women still lack in or is there
13:11an increase in that in that area? So there's always a trend where if you see a lot of people
13:19in your segment doing the same things it just makes you feel more comfortable to ask for more.
13:24Same is happening in the segment which is women and money. You see more and more women talking
13:29about things which is financial independence and that's where you want a lot of it.
13:36It's certainly important because you're earning and you have your own expenses. You want to live
13:42a lifestyle which is of your own obviously not disconnected with your families but at the same
13:47time you're an equal contributor. So how do you build your own path to wealth as your family
13:54builds it or your male counterpart builds it with their set of money? I think for the longest time
14:01we haven't made those kind of decisions on your own. If you see your previous generations while
14:06they must be earning the money the decisions were taken by the male counterpart. You can take the
14:13decisions of you know what necklace do I want to buy but I think you would have never made a
14:17decision where you would say this is the real estate that I want to buy or this is the insurance
14:22that I want to buy without checking with a male counterpart or just taking an opinion.
14:28So that's where the awareness is that you can learn on your own. You can deploy your money
14:33on your own and you've got a large support circle in the UAE and otherwise which supports
14:42you to do these things. So you mentioned you know like buying a real estate property or an investment
14:48of some sort. Do you feel like there's an increase in the number of women who are actually gaining
14:52that independence and making those investments? Absolutely like if you see the recent trends you
14:57would see a lot of real estate transactions are done only by women and at the same time you're
15:05you're doing it together with your spouse right. So there's a larger ownership which is coming in.
15:10The only point is how do you also look at beyond real estate other things where you educate yourself
15:16and start deploying your money. I have not seen anyone talking about what insurance should I buy,
15:22do I need an insurance of my own, would my insurance drive my family's health after I'm gone
15:28right. Why are we not making those kind of conversations really normal. So yeah there are
15:35so many things to change but it comes with internal ownership and then talking it loud.
15:40Talking it loud with yourself and with with your counterparts as well in the family that
15:47let's do it together that's where the onus is. Okay I want to dig deeper into say and I want to
15:54know more like about the platforms like can you mention specifically what some platforms do and
15:59how they help people drive like how they allow people to achieve those goals like do you have
16:06any specific platforms that you can mention and how people can sign up to them what the process
16:11is like and that kind of thing. Right so I'd first start with save because it's quite prominent where
16:17it helps users understand their money better. It helps them save by setting up their financial
16:23goals and then to be able to spend once once you have saved money in a very responsible fashion.
16:29We allow our users to be financially literate so how do you learn more about handling of your
16:36money. The second piece is how do we find insights in your spending behavior to save and invest
16:41better and subsequently how do we make it really easy for you and rewarding for you through a whole
16:47lot of automation, gamification, bringing it into milestones so that you just feel excited every
16:53time you're doing more and more. Amazing okay my last question what's your advice just general
17:00advice for someone who doesn't know where to start and is earning an adequate amount of money every
17:07month but feels like they as you said is one of the 50 percent of the population that doesn't
17:14have an emergency savings or any savings of that matter. So three pieces of advice that come in
17:19here. One is set realistic goals for yourself. What do you want to achieve in a year's time frame
17:27three years time frame and subsequently and those are personal right. Always start with an emergency
17:33fund because it's the easiest thing to do and that tick off is going to give you a lot of confidence
17:38that you can do more and more. The second piece is being responsible about consuming credit.
17:44It comes in multiple forms in here with your credit cards, your buy now pay later,
17:50your mortgages, your auto loans and it's always easy to overdo it because everyone around you
17:54is doing it. So it just looks normalized so just take keep a check that this has to be
18:02right whatever you're consuming. The third piece is just be disciplined. It's your life and
18:08you would be the winning person if you consume sustainably you do right things with your money.