The Role of E-Wallet Use and Financial Literacy on Consumptive Behavior in Indonesia

The Fourth Industrial Revolution, which is caused by rapid technical breakthroughs has disrupted nearly every industry and resulted in the widespread use of the Internet, social networks, and digital devices. Since the introduction of e-commerce, digital payment mechanisms have evolved into digital wallets or e-wallets. The popularity of digital payments is growing due to a variety of causes, including high smartphone penetration, a rising number of merchants turning digital, more dependable payment system regulation, and a strong ecosystem of service providers. The advent and ease of use of e-wallets as a payment system do not exclude the likelihood of having an impact on one's purchasing habits. The gradual increase and emergence of e-commerce in Indonesia leads to the increased use of e-wallets and may cause consumptive behavior. Furthermore, the low levels of financial literacy among citizens in Indonesia lead individuals to make poor choices and spend money on unnecessary things. The object of this study will be e-wallet users that recite in Indonesia. The research was conducted in Indonesia with a considerable increase in digitalization despite inadequate financial literacy. The research method was quantitative, utilizing questionnaires and the data collected is analyzed with Structural Equation Modelling (SEM). The results of the investigation depict that both the use of e-wallets and financial literacy has a significant and positive impact on consumptive behavior. The implications and recommendations are also included in this paper. This research is beneficial for business owners and future research to gain insights and for the use of their future undertakings.