| Abstract: |
This paper examines the impact of mobile payments, financial literacy, and
access to formal financial systems on borrowing practices among individuals
residing in the European Union. It utilises data from the 2023 Flash
Eurobarometer 525 and predicts the probability of consumer loan ownership
through a logistic regression model. The analysis shows that borrowers
generally possess higher financial literacy, suggesting an empowered approach
to managing debt. Surprisingly, users of digital financial services tend to
borrow less, potentially indicating that they prefer alternative tools or
manage their finances more prudently. Moreover, possessing financial products
such as savings accounts, mortgages, and insurance increases the likelihood of
borrowing, whereas access to long-term investment products like pensions is
linked with lower borrowing levels. These results suggest that borrowing
decisions are partially influenced by access to financial instruments,
individual financial knowledge, attitudes towards digital finance, and
targeted policies emphasising education alongside comprehensive financial
strategies. |