Digital Financial Literacy and Financial Behavior: Evidence from Vietnam

Abstract

Purpose: This study examines the impact of Digital Financial Literacy (DFL) on individual Financial Behavior (FB), while analyzing the heterogeneous effects of DFL components on different types of financial behavior within the context of Vietnam’s ongoing digital transformation.
Design/methodology/approach: Data were collected from 329 individuals with bank accounts across major cities in Vietnam through an online survey conducted between February and March 2025. The Partial Least Squares Structural Equation Modeling (PLS-SEM) technique was employed to test the relationship between DFL and FB, as well as to explore the distinct role of each DFL dimension.
Findings: The results reveal that overall DFL has a positive and significant effect on financial behavior. However, only three components-financial knowledge, cognitive ability, and decision-making skills-exert a positive influence, whereas practical knowledge shows a negative effect, and digital knowledge and self-protection capability have no significant impact.
Originality/value: This study provides empirical evidence from Vietnam on the multidimensional and non-uniform effects of DFL on financial behavior. The findings suggest that digital financial education programs should prioritize enhancing individuals’ cognitive awareness and decision-making capabilities rather than focusing solely on theoretical or technical knowledge.