Measuring Digital Financial Literacy in the Colombo District, Sri Lanka

Abstract

In the context of rapid financial digitalization, individuals’ ability to effectively use Digital Financial Services (DFS) has become crucial for financial inclusion and economic well-being[cite: 8]. Digital Financial Literacy (DFL) refers to the integration of Financial and Digital Literacy required to access, understand, and use digital financial products and services[cite: 8]. Local survey findings indicate that despite Sri Lanka’s relatively high literacy rate, Digital and Financial Literacy levels remain comparatively low[cite: 8]. This study assesses DFL within a single framework, focusing on Colombo District[cite: 8]. The objectives are to construct DFL scores across knowledge, attitudes, and behaviour, and examine the relationship between demographic characteristics and DFL[cite: 8]. The study adopts a quantitative mono-method research design using primary data from a cross-sectional survey guided by the OECD/INFE DFL framework[cite: 8]. Data were collected from 100 individuals aged 18 and above in Colombo District using a convenience sampling technique[cite: 8]. All participants provided informed consent and collected data were analysed using MS Excel and IBM SPSS[cite: 8]. The findings demonstrate that low digital financial knowledge among respondents[cite: 8]. Furthermore, Digital Financial Behaviours and Attitudes reflect high and moderate levels of engagement respectively, while the overall level of DFL remains moderate level[cite: 8]. Importantly, the results indicate that demographic factors such as gender, age, education, and income significantly influence the level of DFL, aligning with international studies[cite: 8]. The study highlights the importance of targeted, integrated financial and digital literacy initiatives to enhance DFL, ensuring equitable participation in DFS and promoting the effective use of digital finance in Sri Lanka[cite: 8]. The findings are exploratory in nature, and demographic relationships should be interpreted with caution[cite: 8].