Financial Literacy and Wellness among African-Americans: Mobile pay

New Insights from the Personal Finance (P-Fin) Index

One example of fin-tech use was included in the 2019 P-Fin Index survey, given the rising importance of this topic and the potential impact on financial well-being. African-Americans are more likely than whites to pay for products and services by waving or tapping a smartphone at the point of purchase. Thirty percent of African-Americans make mobile payments in this manner (10% frequently, 20% sometimes). The analogous figures among whites are 23%, 7% and 16%, respectively.

Previous research has shown that fin-tech and financial literacy are likely best viewed as complements. While fin-tech use is not necessarily associated with better personal finance outcomes, financial literacy has been shown to improve outcomes in the presence of fin-tech use.17 This phenomenon is observed here as well. Mobile payment users (both African-American and white) with greater financial literacy are more likely to have non-retirement savings than mobile payment users with lower financial literacy (Figure 13).

Source: TIAA Institute-GFLEC Personal Finance Index (2019).

17 See Yakoboski, Lusardi and Hasler (2018).