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on Financial Literacy and Education |
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Issue of 2026–06–08
ten papers chosen by Viviana Di Giovinazzo, Università degli Studi di Milano-Bicocca |
| By: | Raza, Hassan; Siddiqui, Danish Ahmed |
| Abstract: | he primary objective of this study is to develop an optimal framework for a Retail Central Bank Digital Currency (CBDC) by determining how its design features should be structured to achieve financial inclusion and monetary policy enhancement in a developing economy like Pakistan, while explicitly mitigating risks to financial stability and public adoption. This research employed a Systematic Literature Review (SLR) following the PRISMA 2020 Guidelines. A total of 224 academic papers were assessed to synthesize global findings and identify critical consensus and conflicts regarding CBDC design, particularly in contexts relevant to developing nations. The analysis reveals a strong consensus supporting a two-tiered, accessible, and interoperable model as the most pragmatic design. Literature frequently points to the use of Distributed Ledger Technology (DLT) for smart contract functionality and enhanced security, regardless of whether the system is account- or token-based. The review establishes two central tensions in design. The first highlighted is the core conflict between mitigating systemic risk and expanding access. The Second seem to arise from the perspective of Privacy vs. AML/CFT concerns. The viable path for this trade-off is indicated as a tiered system offering high privacy for low-value transactions while mandating stringent AML/CFT checks for large transfers. These findings provide a robust, evidence-based design blueprint for the State Bank of Pakistan and other developing countries considering the issuance of a retail CBDC. By explicitly defining the necessary trade-offs (stability vs. inclusion; privacy vs. compliance), this framework allows policymakers to prioritize design features that maximize public trust and regulatory compliance, thereby significantly accelerating the successful adoption and effective use of a CBDC as a tool for economic modernization and financial deepening. |
| Keywords: | Central Bank Digital Currency, Distributed Ledger Technology, PRISMA2020 Guidelines, Digital Pakistani Rupees, Retail CBDC, Financial Inclusion, Financial Stablitiy |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:esprep:341059 |
| By: | Rehman, Ferheen; Siddiqui, Danish Ahmed |
| Abstract: | The rapid growth of financial technologies has introduced innovative investment avenues, including digital gold, a tokenized form of gold ownership. Despite its potential to promote financial inclusion in emerging markets, limited empirical evidence exists regarding the determinants of intention to invest in digital gold, particularly in Pakistan. Grounded in the Technology Acceptance Model (TAM) and the Theory of Planned Behavior (TPB), this study investigates how attitude, perceived usefulness, perceived ease of use, and perceived behavioral control influence investment intentions. Furthermore, the study examines the mediating roles of regulation and protection, awareness, perceived risk, and trust. Data were collected through a structured survey of 208 participants in Pakistan and analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM). The results reveal that all four direct predictors significantly influenced investment intention. Mediation analysis showed that regulation and protection, perceived risk, and trust significantly mediated several of these relationships, while awareness did not emerge as a significant mediator. Model fit indices indicated an acceptable level of fit (SRMR = 0.087), although the NFI value suggested scope for improvement. The findings highlight the critical role of regulatory safeguards, trust, and risk management in shaping investors' intentions to adopt digital gold, while also demonstrating that awareness alone is insufficient to drive behavioral adoption in the absence of institutional and psychological assurances. The study contributes to theory by integrating the Technology Acceptance Model (TAM) and the Theory of Planned Behavior (TPB) with contextual mediators specifically regulation and protection, trust, perceived risk, and awareness thereby extending classical behavioral frameworks to the domain of fintech-based investment behavior in emerging economies. This integration provides a more comprehensive understanding of how cognitive, attitudinal, and institutional factors jointly influence digital investment decisions. The more study contributes to theory by integrating TAM and TPB with contextual mediators and offers practical insights for policymakers and fintech firms to strengthen regulatory clarity, enhance consumer trust, and expand financial inclusion. |
| Keywords: | digital gold, financial technology, investment intention, regulation, trust, perceived risk, awareness |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:esprep:341066 |
| By: | Quaicoe, Nana |
| Abstract: | In economies where a portion of the population transacts through mobile money and the other portion strictly uses only cash, can any single interest rate rule serve both groups well? I develop a two-agent New Keynesian model calibrated to Ghana in which included households manage liquidity through mobile money under Baumol– Tobin demand, while excluded households depend on government transfers under fiscal dominance. I find a critical threshold at approximately 70 percent financial exclusion.Below it, aggressive inflation targeting is optimal for both household types. Above it, the welfare surface for included households develops an interior optimum, the optimal Taylor rule diverges across groups, and no single rule resolves the conflict. The distributional cost of monetary policy is convex in exclusion: the welfare variance ratio between household types rises from 7.6:1 at 50 percent exclusion to 98:1 at 80 per- cent, the range observed across Sub-Saharan Africa. Aggregate welfare statistics mask this entirely. The trade-off is reducible only through financial inclusion, not through monetary policy design. |
| Keywords: | monetary policy, financial inclusion, mobile money, TANK model, fiscal dominance, Taylor rule, distributional effects, Sub-Saharan Africa |
| JEL: | E52 E58 G23 O16 |
| Date: | 2026–04–18 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:128793 |
| By: | Mdhlalose, Dickson |
| Abstract: | South African small and medium-sized enterprises (SMEs) account for around 34% of national GDP and generate around 60% of employment; however, they continue to be disproportionately impacted by financial management inadequacies. This paper investigates whether the expansion of accessible digital accounting technologies such as cloud-based accounting software, mobile financial applications, and artificial intelligence-assisted analytics is significantly altering the adoption and utility of management accounting information among South African SME owners and managers, or if it simply automates non-value-added compliance tasks. This study synthesises evidence from an integrative review of 60 peer-reviewed sources published between 2020 and 2026, focusing on four thematic domains: digital transformation in the accounting profession; cloud software adoption by SMEs; the evolving advisory role of external accountants; and the triangular relationship among technology use, financial literacy, and decision-making quality. The study contends that digital technologies establish a legitimate yet contingent avenue for improved management accounting participation; their transformative potential is realised solely when supported by sufficient financial literacy, the development of digital skills, and contextually suitable software design. Essential recommendations are aimed at small and medium-sized enterprise owners, accounting practitioners, software developers, and policymakers in South Africa. |
| Keywords: | Cloud-based accounting software, Financial literacy, Decision-making quality, Compliance versus advisory, South African SMEs |
| JEL: | M41 M15 O33 L26 O55 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:esprep:341046 |
| By: | Rizwan, Areeba; Siddiqui, Danish Ahmed |
| Abstract: | This research seeks to analyze the relationships between financial capability and digital financial literacy (DFL), financial attitude (FA), financial autonomy (FAM), and various financial behaviors. These included 1. savings behavior (SB). 2. seeking financial information (FIS), 3. indebtedness behavior (IB), 4. financial control (FC), and 5. poor financial practices (PP). We also explored the complementary role of Impulsivity (IMP) as contributory moderators for these relationships. Based on the TPB as well as SDT, quantitative, explanatory research is employed with correlational studies. Data were gathered from 303 respondents through a five-point Likert scale survey questionnaire administered to individual household investors in Karachi, Pakistan, and analyzed through PLS-SEM. The results indicate that DFL has a positively significant effect on FC and a negatively significant effect on IB, while its effects on FIS, PP, and SB are insignificant. FA has a positively significant effect on FC and SB and a negatively significant effect on IB, whereas its effects on FIS and PP are insignificant. FCA has a positively significant effect on FC and SB, but its effects on IB, PP, and FIS are insignificant. IMP has a negatively significant effect on FC and a positively significant effect on IB, while its effects on FIS, PP, and SB are insignificant. Additionally, IMP's moderating effect is mostly insignificant, except for a positively significant moderation between FA and IB and a positively significant moderation between FAM and SB. Also, gender differences were found in certain relationships, particularly between DFL and SB, FA and IB, FCA and FC, and FCA and IB. The significance of gender-sensitive economic strategies along with educational initiatives is underscored by these outcomes. |
| Keywords: | Financial Behaviors, Digital Financial Literacy, Financial Autonomy, Impulsivity, Gender Differences, Pakistan |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:esprep:341009 |
| By: | Ahmed, Syed Azfar; Siddiqui, Danish Ahmed |
| Abstract: | The research analyzes factors that drive Pakistani Islamic banking customers to adopt Sharia compliant credit cards. The research analyzes how Islamic financial knowledge and perceived usefulness interact with loyalty, religiosity, and management knowledge through the Theory of Planned Behavior and the Technology Acceptance Model to affect consumer attitudes and behavioral intentions. A structured questionnaire yielded data from 267 participants through convenience sampling. Analysis of collected data used Partial Least Squares Structural Equation Modeling (PLS-SEM) through SmartPLS. Knowledge of Islamic financial principles alongside effective knowledge management positively influences customer attitudes as well as their intentions to use Islamic credit cards. The statistical analysis confirmed perceived usefulness together with customer loyalty status as essential factors leading to positive attitudes. Religious preferences showed the opposite influence because they strengthened both customer loyalty and useful perception but reduced adoption intent. Perception of Islamic financial practices showed no direct relationship to adoption intention even though researchers expected it would have an influence. This indicates customers have been prioritizing functionality and trust-based factors above religious aspects. The research findings deliver concrete recommendations for Islamic financial institutions to improve product adoption by educating consumers along with clear product disclosure and individualized support. The study advances theoretical elements through a combination of behavioral and ethical finance approaches that question religious sentiment as the sole factor driving Islamic finance product acceptance. The study supports extensive goals that promote financial inclusion and ethical banking practices for Muslim-majority societies by encouraging institutions to meet changing consumer demands. |
| Keywords: | Intention to Adopt Islamic Finance, Attitude Towards Islamic Finance, Knowledge Management, Loyalty, Loyalty, Perceived Usefulness, Religious Preferences, Knowledge Of Islamic Financial System, Perception of Shariah Compliance |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:esprep:341010 |
| By: | Christelis, Dimitris; Georgarakos, Dimitris; Jappelli, Tullio; Kenny, Geoff; Meyer, Justus |
| Abstract: | We examine recent changes in stock market participation using newly available survey data from eleven euro area countries over the period 2020–2024. The evidence points to substantial turnover, with around 10% of non-stockholders entering the market each year, and more than 20% of stockholders exiting. New entrants tend to have lower education, income, financial literacy, and risk tolerance than established investors, indicating a shift in the composition of market participants. We also highlight the growing importance of cryptocurrency investments among retail investors. Overall, these findings shed new light on evolving household financial behavior and its implications for market participation and financial stability. JEL Classification: D14, E21, G51 |
| Keywords: | consumer expectations survey, crypto assets, household finance, mutual funds, stocks |
| Date: | 2026–05 |
| URL: | https://d.repec.org/n?u=RePEc:ecb:ecbwps:20263239 |
| By: | Arshad, Samra; Siddiqui, Danish Ahmed |
| Abstract: | This study aims to investigate how Recognition-Based Heuristics Bias affects investment decisions and performance. We proposed a theoretical framework built primarily on the fluency theory and cognitive ease theory, implying Heuristics Bias such as 1. alphabetical order (AO), 2. name fluency (NF), and 3. Name memorability (NM) increases the familiarity bias (FB) and the Barnum effect (BE). These, in turn, increase fundamental (FA) and technical anomalies (TA) that ultimately influence investment decisions (IDM) and performance (IP). We also contend that a high level of financial literacy (FL) strengthens the effect of fundamental and technical anomalies on investment decisions and performance. Empirical validity was established by conducting a survey using a closed-ended questionnaire. Data was collected from 318 targeted investors at the Pakistan Stock Exchange and analyzed using confirmatory factor analysis and structural equation modeling. Data analysis was done using PLS-SEM. The result showed that AO positively affects FB and BE, whereas NF and NM exhibit mixed effects. FB positively affects both FA and TA, while BE has a negatively significant effect on FA but has a positively significant effect on TA. FA has a negatively insignificant effect on IDM, and TA has a positively and significant effect. At the same time, both FA and TA have a significant positive effect on IP. Moreover, FB positively mediates between AO and investment anomaly, while BE constitutes a mix of significant and insignificant mediating effects across relationships. FL positively moderates the relationship between investment anomalies and IP. This article enhanced the understanding of the role that recognition-based heuristic-driven biases play in investment management. More importantly, it went some way towards enhancing understanding of behavioral aspects and their influence on investment decision-making and performance in an emerging market. |
| Keywords: | Investment Decision, Financial Anomalies, Barnum Effect, Financial Literacy, Pakistan Stock Exchange, PLS-SEM |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:esprep:341017 |
| By: | Raza, Hassan; Siddiqui, Danish Ahmed |
| Abstract: | While the growing, informal adoption of cryptocurrencies exacerbated by Pakistan's inconsistent regulatory stance regarding cryptocurrency adoption and regulation, presents a speculative and volatile threat to the nation's financial stability, a well-designed Central Bank Digital Currency (CBDC) offers a controlled, secure, and regulated path toward financial inclusion, economic formalization, and enhanced monetary policy control. The objective of this analytical review to search the grey literature and Scientific writings to analyze the mix approach of Pakistan toward Digital Finance especially Cryptocurrency and CBDC. This review article examines this ideological struggle, tracing the history of the State Bank of Pakistan's (SBP) and Securities and Exchange Commission of Pakistan's (SECP) cautionary stance on decentralized cryptocurrencies, driven by concerns over financial integrity, money laundering, and consumer protection. It then contrasts this with the government's recent pivot toward a pro-innovation approach, spearheaded by the establishment of the Pakistan Crypto Council (PCC) and the appointment of key advisors. This pivot is a direct response to a burgeoning, informal digital asset market, with millions of Pakistanis already actively using virtual currencies to hedge against inflation and overcome financial access barriers. The article analyzes two parallel policy pathways emerging from this tension: the development of a state-controlled Central Bank Digital Currency (CBDC) and the formalization of the decentralized virtual assets market through the new Virtual Assets Act (VAA) 2025. The research offers a comprehensive understanding of the strategic trade-offs a developing country faces when navigating the complex relationship between financial stability, technological innovation, and economic inclusion, providing a crucial case study for international policymakers. |
| Keywords: | CBDC, Cryptocurrency, Digital Pakistani Rupee, Pakistan Crypto Council (PCC), Distributed Ledger Technology |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:esprep:341060 |
| By: | Mavuma, David; Kahambwe, Chris |
| Abstract: | This study examines the potential effects of transaction costs associated with electronic payments in foreign currency on household purchasing power in the Democratic Republic of the Congo within the framework of the reform proposed by the Central Bank of Congo. Using a transaction cost analysis and simulations based on the tariff structures of major Mobile Money operators, the findings suggest that transaction fees may increase the effective cost of goods and services and reduce consumers’ purchasing power. In a context characterized by poverty, low banking penetration, and a large informal sector, the study highlights the need for appropriate regulatory and inclusion measures to protect vulnerable populations and ensure the achievement of the reform’s financial traceability objectives. |
| Keywords: | Transaction Costs; Mobile Money; Purchasing Power; Payment Reform; Financial Inclusion; Democratic Republic of Congo. |
| JEL: | E42 G21 L81 O16 |
| Date: | 2026–05–24 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:129279 |