ROLE OF FINANCIAL LITERACY IN PREDICTING FINANCIAL BEHAVIOUR : THE MEDIATING ROLE OF FINANCIAL SELF-EFFICACY release_62evd62ie5hv3pbhjrhzik3uvu

Abstract

Abstract: The financial behaviour of an investor not only determines the wellbeing of individual, but that of the family, community and the nation as a whole. This makes it crucial to understand the drivers of financial behaviour. The current study is based on salaried class investors in Bengaluru, India. The researcher explored the impact of two antecedents of financial behaviour; financial literacy and financial self-efficacy. In addition, the intervening role of financial self-efficacy, on dependent and independent variables was also examined. A sample of 200 respondents were chosen for the study and data was collected through a structured questionnaire. Pearson's correlation and linear regression were used to test the hypotheses of the study. The results indicated a positive moderate correlation among the variables and suggests that financial literacy is vital in shaping the financial behaviour of an investor and this relationship is strengthened by financial self-efficacy. In addition to adding to the existing literature, the findings suggests that financial literacy accompanied by financial self-efficacy enable the investor to make prudent financial decision
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