Money and Banking
Senior 6 · English
Money and Banking
Lesson 2 of 4
25 min
Let's begin
The first time you open a bank account, you will be asked questions and offered choices quickly, in formal English or Kinyarwanda, and the details matter: a fee, a limit, a rule about your PIN. In this lesson you listen to a school leaver opening her first account and take notes as you would at the counter. Then you use the arithmetic of interest to argue, in a short speech, for saving and against careless debt.
Important
Listening script: for two readers
Only the readers open the script; everyone else keeps it closed until the tasks are finished. About three minutes. Keza, who has just finished S6, and Mr Nkurunziza, a customer-service officer, are imagined, and so is Isoko Bank; its fees and rates are illustrative.
Mr Nkurunziza: Good morning, and welcome to Isoko Bank. How can I help you?
Keza: Good morning. I'd like to open an account, please. I've started a holiday job at a hotel, and they'd prefer to pay my salary into a bank.
Mr Nkurunziza: Congratulations on the job. May I ask how old you are?
Keza: Eighteen, since March.
Mr Nkurunziza: Then you can open an account in your own name. Under eighteen, a parent or guardian would have to sign with you. Have you brought your national identity card?
Keza: Yes, here it is. Is that all you need?
Mr Nkurunziza: The card and a phone number registered in your name. Now, which kind of account do you have in mind? We have three. A current account is for people who make a lot of payments; it has a monthly fee of one thousand francs. A savings account has no monthly fee and pays six per cent a year, but you can make only four withdrawals a month without a charge. And a fixed deposit pays more, eight per cent, but your money is locked in for a term you choose, say twelve months. If you take it out early, you lose most of the interest.
Keza: Sorry, could you explain "locked in"?
Mr Nkurunziza: Of course. It means you agree not to touch the money until the end of the term. It suits money you're sure you won't need.
Keza: Then I think the savings account. My salary will be paid in, and I'd like to keep most of it for university. So, if I understand correctly, there's no fee as long as I don't take money out more than four times a month?
Mr Nkurunziza: Exactly. You'll need to deposit five thousand francs to open it. You'll also get a debit card and a PIN, and you can use our app to move money between your account and your mobile money wallet.
Keza: That's useful. Will I get statements?
Mr Nkurunziza: Every month, in the app. Before you go, two rules, and please remember them. First, nobody from the bank will ever ask for your PIN or the code we send to your phone. If someone calls and asks for it, it's a fraud: hang up. Second, if your card is lost or stolen, call us at once, day or night, and we'll block it.
Keza: I'll remember. Thank you very much for your help.
Mr Nkurunziza: You're welcome. Now, if you could just fill in this form and sign at the bottom …
| Item | Note |
|---|---|
| Documents needed | (1) … |
| Current account | for frequent payments; monthly fee of (2) … |
| Savings account | no monthly fee; interest (3) … a year; free withdrawals: (4) … a month |
| Fixed deposit | 8% a year; money locked in for a term; early withdrawal: (5) … |
| Opening deposit | (6) … |
| Moving money to and from a phone | (7) … |
| Safety rules | (8) … (9) … |
Notes: (1) national identity card and a phone number registered in her name; (2) Frw 1,000; (3) 6%; (4) four; (5) she loses most of the interest; (6) Frw 5,000; (7) the bank's app; (8) never give anyone the PIN or the code sent to the phone; (9) report a lost or stolen card at once so that it can be blocked.
Definition
Banking words from the conversation
Interest is the strongest argument on both sides. Suppose Frw 100,000 is saved at 8% a year, and the interest is left in the account. Each year the interest is added and then earns interest itself: this is compound interest. The same arithmetic works against a borrower who leaves a debt of Frw 100,000 unpaid at 15% a year. (Both rates are illustrative.)
Worked example
Working out compound interest year by year
Frw 100,000 is saved at 8% a year; the interest is added at the end of each year.
In one step: . With simple interest the saver would have ; compounding adds Frw 1,971.20 more. For the debt at 15%: .
The rule of 72: divide 72 by the yearly rate to estimate how many years it takes for money to double. At 8%: years (check: ). An unpaid debt at 15% doubles in about years.
Your class has been invited to speak at the first meeting of a youth savings group (an ikimina) in your sector. Prepare a two-minute speech persuading young people to save regularly and to borrow only with care. Then take two objections from the audience and answer them.
| Move | Useful language |
|---|---|
| Open with a question or a picture | How many of you have had money on Monday and none by Friday? |
| Give a reason with evidence | Consider this: Frw 100,000 saved at 8% a year becomes almost Frw 126,000 in three years. |
| Appeal to the listener's own goals | Think of the motorbike, the course or the shop you want in five years' time. |
| Concede, then counter an objection | That's a fair point; however, … · I take your point, but … · You're right that …, and yet … |
| Call to action | So start this week, even with Frw 500. What matters is the habit, not the amount. |
Tip
One number, made human. An audience forgets bare figures but remembers a picture. Instead of "a daily saving of Frw 500", say: "Give up one Frw 500 soda a day, and in a year you will have saved Frw 182,500." Check the figure first (), so that the story is backed by the arithmetic.
Warning
Calculating simple and compound interest, from Khan Academy's YouTube channel (about 7 minutes, 2024). Watch how the two methods are set side by side, then check the year-by-year example above in the same way.
Practice
Sources and credits
