Artificial Intelligence Literacy for Digital Learning: Investigating the Mediating Role of Digital Self-Efficacy in Financial Decision-Making among University Students

Abstract

The rapid integration of artificial intelligence and digital technologies into higher education has created new opportunities for students to access information, develop digital competencies, and make informed decisions in everyday life, including financial decision-making. This study examined the relationship between Artificial Intelligence Literacy and Financial Decision-Making among university students and investigated the mediating role of Digital Self-Efficacy in this relationship. A quantitative, cross-sectional research design was employed, and data were collected from 397 university students from higher education institutions in Punjab and Sindh, Pakistan, through an adopted structured questionnaire administered online using Google Forms. The questionnaire measured Artificial Intelligence Literacy, Digital Self-Efficacy, and Financial Decision-Making using five-point Likert-scale items. The collected data were organized in Microsoft Excel and subsequently analyzed using IBM SPSS Statistics through descriptive statistics, reliability analysis, Pearson correlation, regression analysis, and mediation analysis. The findings demonstrated significant positive relationships among Artificial Intelligence Literacy, Digital Self-Efficacy, and Financial Decision-Making. Artificial Intelligence Literacy was found to positively contribute to students’ Financial Decision-Making and Digital Self-Efficacy, while Digital Self-Efficacy also positively contributed to Financial Decision-Making. The mediation analysis further demonstrated that Digital Self-Efficacy significantly mediated the relationship between Artificial Intelligence Literacy and Financial Decision-Making, indicating that students’ confidence in using digital technologies represents an important mechanism through which AI literacy can contribute to more effective financial decision-making. The study contributes to the emerging literature by integrating AI literacy, digital self-efficacy, and financial decision-making within a single framework and highlights the importance of developing students’ technological knowledge, critical digital capabilities, and confidence for responsible decision-making in increasingly AI-driven environments.