DIGITAL FINANCIAL LITERACY AND PERSONAL FINANCIAL MANAGEMENT IN THE DIGITAL AGE: A NARRATIVE REVIEW
DOI:
https://doi.org/10.35631/IJEMP.935051Keywords:
Digital Financial Literacy, Personal Financial Management, Fintech Adoption, Consumer Financial Behavior, Financial Well-Being, Digital Inclusion, Narrative ReviewAbstract
The rise of digital finance services, fintech platforms, and mobile banking systems has completely revolutionized contemporary personal financial management (PFM). Even though there is a great deal of research on this topic, the available literature is rather fragmented and suffers from inconsistencies in operational definition, sectoral focus, and conceptualization of the processes of conversion of Digital Financial Literacy (DFL) to real-life PFM practices. In response to this situation, the current narrative review synthesizes peer-reviewed literature on this topic found in Scopus between 2020 and 2026. Employing complementary conceptualizations from the Technology Acceptance Model, the Theory of Planned Behavior, and Human Capital Theory, the review analyzes technology adoption, behavioral conversion, and capability building in the context of the DFL-PFM connection. The review conceptualizes DFL as a multifaceted capability involving financial literacy, digital proficiency, and digital risk consciousness, which, in turn, is positively correlated with budgeting behavior, saving behavior, and resistance to digital fraud. Nonetheless, a key contradiction arises in the sense that increased skills in digital financial platforms do not guarantee proper financial management skills since those who are digitally literate can indulge in reckless spending, borrowing, and speculative finances. In this context, this review offers a consolidated theoretical framework to reconcile the dichotomy between personal digital skills and overall market dynamics. From an applied perspective, this review brings out the need for clear digital financial information, relevant spending and risk warnings, and financial education in order to enable consumers to make sound financial decisions.
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