Cyprus University of Technology in cooperation with partners from Latvia, Italy, Portugal and the Netherlands are currently implementing the project DIFILIM - Digital Financial Literacy for Microenterprises. Managing personal finances today is more complicated and time-consuming, yet more important than ever. The Covid-19 pandemic has highlighted the significance of digital technologies for the resilience of firms in turbulent times. Ergo, the digital age demands for “digitally smart” people for their effective participation in the new economy and DIFILIM is contributing in this direction because micro-entrepreneurs need to have an ever-increasing financial awareness and competency to effectively use products offered through digital channels. All-in-all, the main aim of the project is to contribute towards enhancing digital financial literacy/inclusion of European micro, small and medium-sized enterprises.

Most firms in European countries are SMEs, with rates exceeding 90%, whilst such countries also present very high solo self-employment shares in the EU. At the same time, the momentum for firms in these countries has not looked particularly favourable over the last decade. Specifically, European countries like Cyprus were hit by two substantial shocks, one asymmetric (the debt crisis) and one symmetric (the recent Covid-19 pandemic). Taking as an example Cyprus, the recent banking crisis in 2013 had multiple negative effects, including crippling the economy and severely damaging the country’s banking sector. Overall, the pre-crisis paradigm did not contribute to the emergence of innovative and financially resilient firms in some European including Cyprus, which are the main attributes of value in the post-pandemic economic system. The rise of non-performing loans, the fragmentation in the EU financial system and the marginal availability of alternative sources of financing hinder productivity growth of firms across sectors and deter innovation and digitalization, which are perennial to the integration of enterprises to the 4th industrial revolution. Against the above background, the era of financial technology (FinTech) is changing the financial services industry at a rapid pace, with consumers and “small investors” becoming increasingly more exposed to new financial products. The financial resilience of European enterprises in the Covid-19 era, the lack of coverage in terms of benefits and government subsidies for enterprises and employees, and the opportunities that might arise in the period of recovery, along with the availability of novel FinTech instruments, make the project’s agenda of utmost interest and importance for the economy’s stakeholders and policymakers.

The project has set the following goals:

• To contribute towards enhancing digital financial literacy/inclusion in certain European micro, small and medium-sized enterprises (MSMEs).
• To identify digital and financial literacy needs and provide training to fill in this gap for both professional and unemployed people.
• To develop an attractive, training programme in the country language, that will allow digital financial literacy enhancement.
• To deliver a curriculum to meet the real needs of entrepreneurs in the areas of financial literacy and digital skills.
• To design and apply a curriculum to deliver skills in a combination of methods including an e-learning platform.
• To create networks at local, regional and European levels for spreading good practices of educational integration.

Planned project activities:

• Research on the needs and impact of Digital Financial Literacy on enterprises in each Partner Country;
• Guidebook of Digital Financial Literacy for Microenterprises in each Partner Language;
• Online Training Platform development in English and each Partner Language;
• Monitoring, Quality Assurance Plan and Dissemination Strategy.

Partners:

1. Turiba University (Latvia)
2. Cyprus University of Technology (Cyprus)
3. Magnetar Ltd (Cyprus)
4. Forma Camera, Special Agency of the Chamber of Commerce, Industry, Craft and Agriculture of Rome (Italy)
5. Amadora Inovation E.M. Unipessoal Lda (Portugal)
6. Stichting Incubator (The Netherlands)

Project implementation period: 01.11.2021 - 31.10.2023

Contacts:

Dr Panayiotis C. Andreou

Project expert

Associate Professor of Finance

Link to website https://www.cut.ac.cy/faculties/fme/cfs/staff/academic-personnel/Panayiotis+Andreou/?languageId=1

Additional information about the project:

DIFILIM – Digital Financial Literacy for Microenterprises

Project is co-financed by ERASMUS+ programme.

Project number: 2021-1-LV01-KA220-ADU-000028225