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Financial resilience refers to the ability to recover quickly from economic difficulties. It is the ability to return to its original form after a deformation or, figuratively speaking, after an adverse situation. We are all subject to unforeseen events, and resilience means overcoming these challenges without significantly altering the course of our plans and objectives.

The degree of financial resilience of families has macroeconomic and social implications. The greater the resilience, the less vulnerable they are in times of economic crisis, such as that experienced recently during the pandemic years. This experience has put financial resilience on the global agenda, including in the developed world, as we will see below.

One indicator of financial resilience is the availability of one's own resources to deal with unforeseen events. These resources originate, for example, in the habit of saving, which is still not very widespread among Brazilians. According to Investor's X-Ray, published by ANBIMA (Brazilian Association of Financial and Capital Market Entities), the percentage of Brazilians who saved money in 2022 was 32%. In classes D and E, this percentage drops to 16%.

This scenario reflects a national reality: savings are scarce and debts prevail. Data released by the credit bureau sector indicates that the percentage of people with a negative credit rating in the country reaches 40%, which distances this contingent even further from financial resilience, limiting access to credit in emergency situations.

Financial resilience paves the way for sustainable credit, if own resources are insufficient. The quality of credit available depends on the credit history built up by the consumer. The better your payment history, the more likely you are to be approved for credit on fairer terms, whether you're trying to get through bad times or fulfill a consumer dream.

A report published by the OECD (Organization for Economic Cooperation and Development), G20 and Global Partnership for Financial Inclusion discussed the relationship between resilience, well-being and financial literacy, highlighting that the ultimate goal of resilience is financial well-being. Using a database from a range of countries, the report found a positive correlation between financial well-being and behaviors associated with greater financial resilience. The data also suggests a positive correlation between financial literacy and resilience.

Financial resilience was also highlighted in the "Financial Inclusion Report", published by the UK government. Among the initiatives adopted to increase resilience, the document mentions the encouragement of savings among the low-income population, through the program "Help to Save. This population, using a savings account, can make deposits of up to 50 pounds a month and redeem these amounts plus a bonus much higher than the interest rate after two or four years.

In Brazil, the issue of personal finance has gained momentum since the middle of the last decade, mobilizing private companies and government bodies. Among the initiatives is the creation of the ENEF Week, dedicated to dealing with financial education issues. The theme of ENEF Week 2023, which took place in the first half of the year, was financial resilience. Another important initiative is the Learning Valueled by Central Bank of Brazil. This project has already taken the debate on financial education to 22,000 primary schools in more than half of Brazil's municipalities, according to the Central Bank.

In the private sector, in addition to the services provided to the various categories of credit grantors, the bureaus have expanded their communication and range of services aimed at consumers and companies, providing educational content on finance and tools to help control financial life. These tools include free, digital consultation of credit scores and any restrictions, which makes it easier to identify pending issues and, more than that, encourages punctual payments. The sector also offers services aimed at preventing and detecting fraud - another pillar of resilience pointed out by the OECD.

Surveys carried out by ANBC - National Association of Credit Bureaus have shown throughout this year that these tools have been used and recognized by a significant part of the population as important for their financial lives and for taking out credit.

Strengthening financial resilience is an objective to be pursued by the credit ecosystem and by governments as a way of giving families more security in the face of adverse economic shocks, increasing social well-being and enabling the realization of personal dreams.

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By: Elias Sfeir President of ANBC & Member of the Climate Council of the City of São Paulo & Certified Advisor