FINANCIAL LITERACY, BEHAVIOR, AND INCLUSION AS PREDICTORS OF FINANCIAL WELL-BEING AMONG YOUNG BNPL USERS: A CONCEPTUAL FRAMEWORK

Abstract

There are now more worries about the long-term financial well-being of young people due to the rapid growth of Buy Now Pay Later (BNPL) services in Malaysia. Although BNPL platforms offer short-term affordability and convenience, young people often lack the financial literacy, behavior, and protections necessary to use these credit tools effectively. As a result, young people are more susceptible to financial stress, debt accumulation, and excessive spending. In order to investigate how financial literacy, financial behavior, and financial inclusion impact the financial well-being of young BNPL users, this conceptual paper proposes a theoretical framework based on Financial Capability Theory (FCT). The framework emphasizes the relationship between financial services by integrating three functional constructs that stand for both internal capacity and external opportunity. The model is based on three hypotheses, all of which aim to advance our knowledge of young people's financial opportunities in the digitally driven economy. This study presents a theoretical contribution by expanding the application of FCT to the understudied area of youth BNPL usage. In practice, the concept helps Fintech companies, educators, and legislators create more responsible credit systems and financial literacy initiatives. The model should be empirically validated in future studies, and demographic variables influencing these correlations should be investigated.