Ai-enabled fintech applications adoption and digital financial literacy among Malaysian youth in the Klang Valley: a utaut2 perspective

Teoh, Yee Xin (2025) Ai-enabled fintech applications adoption and digital financial literacy among Malaysian youth in the Klang Valley: a utaut2 perspective. Final Year Project, UTAR.

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Abstract

The financial services industry in Malaysia has undergone rapid transformation through financial technology (FinTech), particularly artificial intelligence (AI). The young Malaysians are one of the most utilized users of AI-enabled FinTech applications. They are deemed as digital natives. The technological exposure of many young people has not provided them with adequate digital financial literacy (DFL). It is this weakness that can cause them to struggle safely and effectively use these tools. The paper examines the drivers of the adoption of AI-enabled financial technology by teenagers in the Malaysian population with particular reference to the influence of digital financial literacy. It adheres to Unified Theory of Acceptance and Use of Technology 2 (UTAUT 2). This research use cross-sectional, quantitative, and descriptive research design. A questionnaire that was prepared to be used systematically on the internet captured details of 250 young Malaysians residing in the Klang Valley. SmartPLS and Partial Least Squares Structural Equation Modeling (PLS-SEM) were used as methods to analyze measurement and structural models. The findings indicate that performance expectation, hedonic motivation, price value, and habit have a significant influence on the intention to use AI-enabled FinTech applications. Conversely, social influence, expectation of effort, and facilitating condition were not significant predictors. The results demonstrate that intent has a considerable impact on real usage. Moreover, digital financial literacy partly mediates the relationships between intention and actual usage, which implies that intention alone cannot be utilized without the appropriate digital financial skills. This study enhances the UTAUT2 model by making digital financial literacy a mediating variable, which offers more knowledge on how effective the intention behavior gap is in the adoption of AI-enabled FinTech. The research has policy implications for policymakers, teachers, and FinTech developers. They will be able to work towards the development of specific financial literacy tools, responsible usage of FinTech, and enhancement of the financial health of young Malaysians. Keywords: AI-enabled FinTech; Digital Financial Literacy; UTAUT2; Behavioral Intention; Malaysian Youth

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