Determinants Of Financial Literacy: A Structural Equation Modelling Approach

Abstract

The study explores the key determinants of financial literacy, focusing on financial education, social influence, and financial self-efficacy. Using a Structural Equation Modelling (SEM) approach, data were collected from 277 respondents and analysed to test the proposed hypotheses. Exploratory Factor Analysis (EFA) identified three core factors influencing financial literacy. Financial education, social influence, and financial self-efficacy emerged as significant predictors of financial literacy, explaining 62.4% of the variance. The findings underscore the importance of promoting financial education programs and fostering peer discussions to enhance financial literacy in organizations. Implications for policy and practice are discussed.