Education and Digital Finance: Exploring the Relationship between Educational Attainment and Online Banking Engagement in Sri Lanka

Abstract

This study investigates the relationship between educational attainment and online banking engagement among adults in Sri Lanka, addressing a critical gap in digital financial inclusion literature. Despite high general literacy and expanding digital infrastructure, online banking usage in Sri Lanka remains disproportionately low, with only about 1% of bank customers actively using such services. Using simple random sampling method data were collected from 382 respondents in the Balangoda Divisional Secretariat Division and analyzed using ANOVA. The findings reveal a statistically significant difference in online banking usage across various education levels. Specifically, individuals with a bachelor's degree or higher reported the highest levels of engagement, while those with lower educational qualifications, particularly below GCE O/L, demonstrated minimal usage. Pairwise comparisons further confirmed that increased education correlates positively with greater online banking usage, likely due to improved digital literacy, cognitive ability, and familiarity with financial technologies. The study emphasizes that educational attainment is a key predictor of digital financial behavior, surpassing the effects of general literacy alone. These findings suggest that policies aimed at promoting online banking should consider targeted educational interventions, especially in regions with lower educational access. By highlighting education as a central factor in technology adoption, this research contributes to a more nuanced understanding of digital inclusion and offers valuable insights for policymakers seeking to enhance equitable access to financial services in developing economies like Sri Lanka.