Factors affecting financial management behavior of Paylater users in Indonesia: Examining the moderating role of locus of control


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Financial Management Behavior refers to the systematic activities involved in predicting, gathering, allocating, investing, and strategizing the cash flow required for a company’s or individual’s efficient functioning. This study aims to examine the role of locus of control in moderating the relationship between financial socialization, financial knowledge, financial experience, and financial management behavior among Paylater users in Medan, North Sumatra, Indonesia. The population of this research is the people of Medan, North Sumatra, Indonesia, who use Paylater. The sampling methodologies utilized were purposive sampling and snowball sampling. A total of 221 individuals participated in data collection for this study. The questionnaires were disseminated using social media chat functions or messaging applications (e.g., WhatsApp, Line, Telegram) in which the Google Forms link is shared. The study employs the data analysis technique of SEM-PLS with the assistance of PLS 4.00 software. The research results show that financial socialization, knowledge, and experience influence financial management behavior (p < 0.05). Furthermore, financial socialization, financial knowledge, and financial experience influence financial management behavior, moderated by locus of control (p < 0.05). The research implications are expected to improve the Financial Management behavior of the Paylater users by providing literacy about managing their finances.

This study was funded by the Revenue and Expenditure Budget of the Universitas Muhammadiyah Sumatera Utara following the assignment agreement letter in the context of implementing the Basic Research Program of the Revenue and Expenditure Budget of the Universitas Muhammadiyah Sumatera Utara for the 2023 Fiscal Year, Number: 73/II.3- AU /UMSU-LP2M/C/2023.

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    • Figure 1. Conceptual model
    • Table 1. Cronbach’s alpha and composite reliability
    • Table 2. Average variance extracted
    • Table 3. Cross-loading
    • Table 4. Fornell-Larcker criterion
    • Table 5. Average communalities index
    • Table 6. R-square
    • Table 7. Direct effects and moderating effects
    • Conceptualization
      Ade Gunawan
    • Data curation
      Ade Gunawan, Mukmin, Sri Fitri Wahyuni
    • Investigation
      Ade Gunawan, Mukmin, Sri Fitri Wahyuni, Maya Sari
    • Methodology
      Ade Gunawan, Maya Sari
    • Project administration
      Ade Gunawan, Mukmin
    • Supervision
      Ade Gunawan, Mukmin, Maya Sari
    • Visualization
      Ade Gunawan, Mukmin, Sri Fitri Wahyuni
    • Writing – original draft
      Ade Gunawan, Maya Sari
    • Writing – review & editing
      Ade Gunawan, Mukmin, Sri Fitri Wahyuni, Maya Sari
    • Formal Analysis
      Sri Fitri Wahyuni, Maya Sari
    • Validation
      Sri Fitri Wahyuni