Financial Literacy and Financial Behavior of Indonesians in the Digital Era

Abstract

Financial literacy has become a crucial aspect in facing economic dynamics in the digital era. Advances in financial technology bring both opportunities and risks that require individuals to possess adequate knowledge, skills, and prudent financial behavior. According to the Financial Services Authority (Otoritas Jasa Keuangan/OJK), financial literacy encompasses understanding financial products, managing money, and the ability to avoid illegal investments to achieve financial well-being. This study employs a Systematic Literature Review (SLR) method by examining various studies related to financial literacy, financial behavior, and the role of fintech in Indonesia. The findings indicate that good financial literacy improves decision-making, encourages saving, promotes proper investment practices, and reduces potential risks related to debt and digital fraud. However, the financial literacy level of Indonesian society remains relatively low, as indicated by the 2022 OJK survey, which only reached 49.68%. Therefore, it is necessary to implement inclusive, technology-based financial education strategies to enhance the quality of financial management among the public in the digital era.