The impact of financial risk awareness on digital bank usage

Lang, Xuen Li and Lau, En Tong and Ng, Yan Tong and Tan, Chui Zye (2026) The impact of financial risk awareness on digital bank usage. Final Year Project, UTAR.

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Abstract

The rapid development of financial technology has accelerated the growth of digital banks in Malaysia, offering consumers greater convenience, accessibility, and costefficient banking services. As digital banks operate fully through online platforms without physical branches, users are increasingly exposed to various financial risks such as online fraud, phishing scams, identity theft, unauthorized transactions, and data privacy issues. Therefore, this study examines the impact of financial risk awareness on digital bank usage among Malaysian consumers. In addition, the study also investigates the influence of digital financial literacy, perceived security and privacy, and peer or social influence on digital bank usage. This study adopted a quantitative research design using a structured questionnaire distributed through Google Forms and face-to-face QR code survey methods. A total of 401 valid responses were collected from Malaysian residents aged 18 years old and above through purposive sampling. The collected data were analysed using Statistical Package for the Social Sciences (SPSS). The statistical techniques employed included descriptive analysis, reliability test, normality test, multicollinearity test, and multiple linear regression analysis. The findings reveal that digital financial literacy, perceived security and privacy, and peer or social influence have significant positive relationships with digital bank usage. Financial risk awareness was also found to significantly influence digital bank usage, indicating that users with greater awareness of potential risks are more likely to engage in safer and more informed usage of digital banking services. These results suggest that consumers’ knowledge, confidence in platform security, and social environment play important roles in shaping digital bank adoption behaviour. The Impact of Financial Risk Awareness on Digital Bank Usage xvi Overall, this study provides valuable insights for policymakers, regulators, and financial institutions in promoting safer digital bank practices, improving financial literacy, and strengthening consumer protection measures. The findings also contribute to the sustainable growth of the digital bank sector in Malaysia.

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