April is Financial Literacy Month, a time dedicated to highlighting the value of financial education in improving the fiscal well-being of all Americans. This includes a crucial aspect of personal finance that we all encounter: bill payments.
Nowadays, digital literacy is arguably the most important aspect of this curriculum, as it addresses the ease with which the average billpayer can find and use digital channels for critical payments. Billing organizations can promote digital financial literacy by offering accessible online payment options, empowering their communities and streamlining revenue in the process.
What is Digital Financial Literacy?
Digital financial literacy is an emerging concept that emphasizes necessary knowledge and skills to carry out financial transactions on digital platforms.
The research article “Digital financial literacy and financial well-being” defines digital financial literacy as financial knowledge plus four dimensions of digital literacy:
- Digital knowledge
- Awareness of digital financial services
- Practical know-how of using digital financial services
- The ability to avoid digital fraud
That same research found that digital financial literacy was positively associated with financial well-being, largely due to the ability to avoid digital fraud. In fact, the positive impact of avoiding digital fraud was significantly greater than the impact of general financial knowledge.