Abstract
Industry 4.0 trends have a significant influence on the acceleration of technology in Indonesia. The development of financial technology has shifted conventional transactions to electronic money as a means of payment with a digital system. Electronic money users in Indonesia continue to grow, while several factors affect consumer decision making to use electronic money. This study aims to analyze the effect of financial literacy, practicality, and consumer lifestyle on consumer interest in using chip-based electronic money. This research uses a quantitative approach with primary data obtained through questionnaires to chip-based electronic money users. The analytical method used is Structural Equation Modeling (SEM) to verify the factors that determine the indicators of the findings of interest in the use of chip-based electronic money. The study results indicate that: (a) Financial literacy has a significant positive effect on interest in using chip-based electronic money by 14.6%; (b) Financial literacy has a significant positive effect on practicality in the use of chip-based electronic money by 51.8%; (c) Practicality in the use of chip-based electronic money has a significant positive effect on consumer lifestyles by 71.3%; (d) Practicality has a significant positive effect on the use of chip-based electronic money by 25%; and (e) Consumer lifestyle has a significant positive effect on the use of chip-based electronic money by 52.8%. The study results imply that it can be used as a consideration for making monetary policy in Indonesia, dealing with the rapid growth in the use of chip-based electronic money.
Highlights
The objective of this study is to identify to what extent the level of financial literacy, practicality, and consumer lifestyle can affect the use of chip-based electronic money
Validity testing begins with convergent validity with loading factor and Average Variance Extracted (AVE) parameters, discriminant validity begins with cross-loading parameters, while reliability testing begins with Cronbach alpha and composite reliability parameters
Research has been conducted on the analysis of the effect of financial literacy, practicality, and consumer lifestyle on the use of chip-based electronic money using the Structural Equation Model (SEM)
Summary
Publisher’s Note: MDPI stays neutral with regard to jurisdictional claims in published maps and institutional affiliations. Technological developments occur rapidly along with the industry 4.0 trend. Current technologies have succeeded in influencing people’s lifestyles, one of which is a transaction payment mechanism. Financial activities using chip-based electronic money have begun to occur in the community. Chip-based electronic money is expected to process payments faster and easier than conventional systems [1,2]. It is expected to be used by all levels of society but it has not been evenly distributed among Indonesian people as consumers
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