Digital Payment Usage, Financial Literacy, and the Effect on Personal Financial Well-Being among Young Adults

Abstract

The rapid expansion of financial technology has transformed the way young adults conduct financial transactions, making digital payment services an integral part of everyday financial activities. While these technologies offer greater convenience and accessibility, their contribution to personal financial well-being remains dependent on individuals’ financial capability. Therefore, this study aimed to examine the effects of digital payment usage and financial literacy on personal financial well-being among young adults in Banjarmasin, Indonesia. A quantitative explanatory research design was employed using a cross-sectional survey of 300 respondents selected through purposive sampling. Data were collected using a structured questionnaire and analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM) with SmartPLS 4. The findings revealed that both digital payment usage and financial literacy positively and significantly influence personal financial well-being, with financial literacy exhibiting the stronger effect. These results indicate that although digital payment technologies facilitate financial management, sustainable financial well-being depends primarily on individuals’ ability to understand and apply sound financial knowledge in making financial decisions. The study concludes that strengthening financial literacy alongside responsible digital payment adoption is essential for improving financial well-being among young adults and supporting a more sustainable digital financial ecosystem.