Digital Credit and Overspending: Assessing the Moderating Role of Financial Literacy among University Students

Abstract

This study aims to analyze the effect of financial literacy on overspending behavior among paylater service users within the student community of the University of Merdeka Malang. The rising trend of “buy now, pay later” (BNPL) usage among young generations has raised concerns about the emergence of consumptive behavior resulting from low levels of financial literacy. This research adopts a quantitative explanatory approach with a total sample of 400 respondents selected through purposive sampling. Data were collected using an online questionnaire and analyzed using simple linear regression. The results indicate that financial literacy has a negative and significant effect on overspending behavior (t = -11.296; sig = 0.000), with a coefficient of determination (R²) of 0.412. This means that an increase in financial literacy can reduce the tendency for excessive spending by 41.2%. These findings emphasize that sound financial understanding plays a crucial role in shaping rational and responsible consumption behavior. The practical implications highlight the importance of implementing digital financial education programs within the campus environment to encourage students to become smart financial service users oriented toward sustainable financial behavior in the digital economy era.