THE ROLE OF DIGITAL LITERACY AND TRUST IN DRIVING FINTECH ADOPTION: MITIGATING BEHAVIOURAL BIAS FOR ENHANCED EQUITY INVESTMENT DECISIONS

Abstract

PURPOSE:

This study on digital literacy and the influence of trust in FinTech adoption among equities investors shows how these aspects transcend behavioral biases and enhance financial decision-making by means of evidence. The literature integrates the Trust Theoretic Model with the Unified Theory of Acceptance and Use of Technology 2 (UTAUT2) to better grasp how it influences trust levels, perceived usability, and last, the goals of implementing such FinTech sites.

DESIGN/METHODOLOGY/APPROACH

One uses a quantitative method. A poll including 202 equities investors helped to gather the data. Analyzing links between digital literacy, trust, perceived risk, and behavioral intention to utilize FinTech services using structural equation modeling (SEM) Further establishing the direct and indirect impacts of digital literacy on FinTech acceptance are regression and mediation analysis.

FINDINGS:

The results reveal that digital literacy greatly affects investor confidence in FinTech, reduces perceived risk, and raises desire to adopt. Trust was found to function as a partial mediator, therefore supporting the favorable impact of digital literacy on behavioral intention. Adopting FinTech is influenced, first by performance expectation, next by effort expectation and perceived risk. Less important are the impacts of hedonic drive and social influence, though. The study further clarifies the moderating function of trust in reducing behavioral prejudices, thereby guiding more wise decisions on equity investment.

PRACTICAL IMPLICATION:

The findings are helpful for FinTech providers, policymakers, and financial educators. Stronger digital literacy through targeted educational programs can improve investor confidence and trust in FinTech solutions. Further, transparent security measures and user-friendly financial technologies can reduce behavioural biases and lead to more adoption among equity investors.

ORIGINALITY/VALUE

This study contributes to the existing literature by differentiating digital literacy from financial literacy and highlighting the direct impact on FinTech adoption. By integrating UTAUT2 and the Trust Theoretic Model, the research offers a novel perspective on how digital literacy and trust interact to drive financial decision-making in the equity market. The findings offer practical recommendations for fostering inclusive digital finance.