Digital Financial Literacy and Financial Competence: A Women Prospect

Abstract

This study examined the effect of five dimensions of Digital Financial Literacy; Digital Financial Knowledge, Awareness of Digital Financial Services, Digital Financial Tool Usage, Online Financial Security and Risk Control, and Digital Financial Attitude and Behavior on the financial competence of female bank employees in Faisalabad, Pakistan. Using a quantitative cross-sectional design, primary data were collected through a structured 38-item Likert-scale questionnaire adapted from validated instruments. A purposive sample of 344 respondents was obtained from 360 distributed questionnaires, yielding a 95.6% response rate. Data were analyzed using descriptive statistics, Pearson correlation, multiple regression (IBM SPSS 26), and Partial Least Squares Structural Equation Modeling (SmartPLS 4). Reliability analysis demonstrated excellent internal consistency across all constructs (Cronbach's α = 0.93–0.95). The regression model explained 77.6% of the variance in financial competence (R² = 0.776, p < 0.001). Digital Financial Attitude and Behavior emerged as the strongest predictor (β = 0.496, p < 0.001), followed by Digital Financial Knowledge (β = 0.194, p < 0.001) and Online Financial Security and Risk Control (β = 0.147, p = 0.013). Awareness of Digital Financial Services and Digital Financial Tool Usage were not significant in the multivariate model. The findings suggest that financial competence depends primarily on knowledge, cybersecurity awareness, and positive financial behavior, highlighting the need for behavior-focused and security-oriented digital financial literacy programs to strengthen women's financial empowerment in Pakistan.