Spendido: A clever way to tackle debt among young people

Intrum’s digital interactive lesson Spendido aims to educate high school students about personal finances and the dangers of debt.

Personal debt is a growing problem in society, with a worrying lack of awareness of how to maintain sound personal finances. And in this age of online ‘influencers’, instant transactions, SMS loans and delayed payments, it’s young people who are perhaps most vulnerable to getting into financial trouble.

The recent European Consumer Payment Report (ECPR), a financial survey of 25,000 European citizens by credit management company Intrum, found that 22 per cent of 18 to 25-year-olds agreed with the statement: ‘I do not have my financial situation under control’, with 25 to 34-year-olds scoring at the same level.

There’s also a strong belief across all ages that personal economy should be a part of children’s education. The ECPR found that 72 per cent of Europeans agreed with the statement: ‘Children should learn more about household finances at school’.

Spendido: an interactive, online education tool

As part of Intrum’s efforts to lead the way to a sound economy, it has developed Spendido, an interactive, online education tool that can be used by teachers and students at senior high schools. Initially the programme is being piloted in Sweden, but Intrum hopes to roll it out further in Europe.

- Spendido is about educating young people in these subjects so that they can understand what credit is, so they can make sound decisions about their own finances, says Karolina Castillo, a Marketing Officer at Intrum, who leads the Spendido project.

Karolina Castillo

Castillo often speaks to students aged around 16 to 19 years old as part of the company’s outreach and says that it’s a generation who face a lot of spending pressure.

- We see that there is a lack of knowledge in this area in society today. Young people have a higher risk of being trapped by debt than older generations do, because it is easier to buy things on instalment and via invoice, often without them fully understanding the repayment terms.

Castillo adds:

- With Spendido, one can calculate how much more something costs when it’s paid off in instalments, how a payment case comes to debt collection and what the personal consequences are when someone is classed as a non-paying debtor by Kronofogden, the Swedish debt enforcement authority.

What students think of Spendido

Recently, a dozen students aged 18 and 19 from the Kunskapsgymnasiet high school in Stockholm visited Intrum’s headquarters to learn more about Spendido. The students tried the online tool’s calculator to work out how much something costs on instalment and took a payments quiz.

The interactive lesson got a unanimous thumbs-up. Several said that it helped them to understand better what it means to pay for something on credit and why settling bills on time is important.

- Credits are an important and necessary part of society but a record of bad payment behaviour can delay young people’s transition to being independent adults through affecting their ability to get mobile phone contract, a mortgage or even a job, says Karolina Castillo.

- We want to help students avoid falling into indebtedness, and Spendido is one way of helping.

Spendido is useful for teachers, too

Economics teacher Claes Kuylenstierna was one of those accompanying the students to the lesson. He was impressed by Spendido.
- Often for people around this age, interest and money are unfortunately quite abstract concepts, because Mum or Dad pays,” he says. 
- But, in this case, it becomes very clear because they can see that something which is priced at 3,000 Swedish Kronor can end up costing 4,500 kronor at 61 percent interest when you delay payments. This helps the idea of interest become concrete to them very quickly.

So, will Mr Kuylenstierna be using Spendido in his lessons?
- I think so because until now I have not found any good way to explain the idea of effective interest rates and personal finances clearly. But I have that now.