Digital Banking Usage, Financial Well-Being, and Psychological Resilience among Young Adults: The Mediating Role of Financial Self-Efficacy

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The rapid expansion of digital banking has transformed how young adults access, manage, and monitor their financial resources, creating new opportunities to enhance financial well-being while raising important questions regarding psychological resilience and financial confidence. The present study examined the relationships between digital banking usage, financial well-being, psychological resilience, and financial self-efficacy and investigated the mediating role of financial self-efficacy among young adults. A quantitative, cross-sectional research design was adopted, and data were collected from 467 young adults residing in Punjab and Sindh, Pakistan. Data were collected through an online structured questionnaire administered using Google Forms, after which the responses were organized and initially processed in Microsoft Excel before being transferred to IBM SPSS for statistical analysis. Descriptive, reliability, correlation, regression, group-comparison, and mediation analyses were conducted to examine the relationships among the study variables. The findings demonstrated positive relationships among digital banking usage, financial well-being, psychological resilience, and financial self-efficacy. Digital banking usage and financial self-efficacy were also identified as significant predictors of financial well-being, while significant differences were observed across selected demographic groups. Furthermore, the findings indicated that financial self-efficacy played an important mediating role in the relationship between digital banking usage and financial well-being. Overall, the findings suggest that digital banking may contribute to improved financial and psychological outcomes when young adults possess sufficient confidence and capability to manage their financial resources effectively. The study extends the emerging literature on digital financial behaviour by integrating technological engagement, financial outcomes, and psychological mechanisms within a unified framework. The findings have important implications for financial institutions, educational organizations, and policymakers seeking to promote responsible digital banking, strengthen financial self-efficacy, and improve financial well-being among young adults in Pakistan.