Modified UTAUT Model to Explore Drivers of Fintech Adoption: Mediating Role of Financial Literacy

Abstract: The inception of fintech has transformed financial sector; this creates need for complete understanding about the factors that drive fintech adoption intention. This study aims to determine these factors by using UTAUT framework. We examine predictors-performance expectancy (PE), effort expectancy (EE), facilitating conditions (FC), social influence (SI) and TRUST. This study also assists the mediating role of financial literacy (FL). PLS-SEM approach was adopted and data were collected through questionnaire based survey from diverse demographic earning low income. Result indicates that PE, EE, SI, FC and trust significantly influence intention to adopt fintech. Furthermore, FL was found to play a crucial role as a mediator. Findings suggest that FL partially mediates the relationship between these variables and intention to adopt fintech. This happens because of limited access to Internet facility, digital divide and insufficient digital infrastructure. This study also explains the importance of financial literacy in considering the fintech adoption intention. It provides a practical implication to policymakers and fintech providers seeking to enhance financial literacy initiative. The findings of this study underscore the necessity for educational programme to boost individual financial knowledge, which would facilitate fintech adoption. Keywords: UTAUT, Fintech, Lower Income Groups, Financial Literacy JEL Classification Number: G53, G41