Digital literacy, financial literacy and financial management behaviour: Empirical evidence from Vietnam

Abstract

Many studies have suggested that financial literacy (FL) helps increase individual economic well-being, enhancing financial inclusion across countries. However, there is currently no consensus on measuring financial literacy (FL). Moreover, the rapid growth of digital financial services (DFS) due to the COVID-19 pandemic has continuously raised various concerns that traditional financial literacy is not good enough for individuals to access and use DFS effectively . In this study, we aim to investigate the impact of financial literacy (FL) and digital literacy (DL) on personal financial planning behavior, including spending, saving, and borrowing. The study used quantitative methods and data analysis of 377 Vietnamese young people of gen Z and Y. The results show that FL and DL have significant impacts on personal financial behavior. In particular FL, DL, and DFL are positively associated with personal spending, saving, and borrowing behavior, especially on digital platforms. In contrast, the opposite effect is significant in explaining individuals' over-spending and formal borrowing behavior. The finding from this study can be used by policymakers to design financial education programs, aiming to increase the level of financial literacy and awareness of digital financial literacy and personal financial planning for the young generation.