The Role of Financial Behavior in Mediating the Influence of Socioeconomic Characteristic and Neuroticism Personality Traits on Financial Satisfaction

The inherent socioeconomic characteristics and personality traits of individuals can have direct effects on their financial satisfaction. There has been no research that examines the effects of these two factors on financial satisfaction with financial behavior acting as the mediating variable even though it is very important to know whether individuals with certain characteristics and personality traits are able to increase their financial satisfaction by improving their financial behavior. 2. Methods This research involved 600 respondents in Medan, Indonesia. The primary data were obtained from the questionnaire. Data analyses were performed by using the partial least squares structural equation modeling (PLS-SEM) method. 3. Results and findings The test results show that at 5% of alpha, the financial behavior, which consists of investment behavior, debt behavior, and spending behavior, is able to mediate the effects of gender, age, level of education, income, and neuroticism traits on financial satisfaction. In addition, it is also found that the higher the individuals' scores on neuroticism are, the worse their investment, debt, and spending behaviors will be; however, their herding behavior and financial dissatisfaction increase. Moreover, these people are also not financially well-off. Keywords: Debt behavior, financial satisfaction, investment behavior, neuroticism personality traits, spending behavior.

Do Financial Inclusion, Debt Behavior Affect Business Investment? Study in Small Medium Enterprise Customers of Bank BPD Yogyakarta Indonesia

Bank, financial inclusion, debt behavior, and business investment greatly affect the economic growth of a region industry. The main purpose of this research is to examine the effect of bank behavior, financial inclusion, debt behavior on investment decisions of Micro, Small and Medium Enterprises customers at Bank BPD Yogyakarta, Indonesia. The research sample is BPD Yogyakarta customers Respondents as 200 entrepreneurs are customers who are in debt for business investment. The analysis model uses mediation regression with PLS. The results showed that bank behavior had a positive effect on financial inclusion. Bank behavior has a positive effect on debt behavior. Financial inclusion has a positive effect on business investment. Debt behavior has a positive effect on business investment. Financial inclusion, debt behavior mediates the influence of bank behavior on business investment. The implication of this research is that a clear bank behavior and high commitment of banks are needed in offering bank products. It takes commitment and supervision from the Bank in providing credit to customers so that the use of funds is in accordance with investment objectives.

Debt behavior of different generations before and after COVID-19

The relevance of researching debt behavior in the context of the pandemic is associated with the need to understand the changes in the willingness of Russians to postpone the satisfaction of their needs and help others in the face of a worsening epidemiological, economic and social situation in the country. The aim of the study was to compare the debt behavior of the baby boomer generations X, Y and Z before and after the beginning of the pandemic. Research hypothesis, respondents interviewed prior to COVID-19 will have a lower willingness to lend and borrow, and willingness to fulfill obligations will remain unchanged, compared to respondents interviewed after COVID-19. Sample 1: interviewed from 2013 to January 2019, before the beginning of the COVID-19 pandemic in Russia, N = 390 (159 men, 217 women, 14 did not indicate gender), representatives of different generations. Sample 2: interviewed in 2020, N = 390 (201 men, 189 women), 17–70 years, corresponding in age and number of representatives of different generations to respondents from sample 1. Methods: questionnaire, including socio-demographic data and borrowing experience, “Debt behavior express inventory”. For sample 2, additionally the experience of the COVID-19 pandemic and questionnaire “Attitude of the individual to the epidemiological threat” by T. A. Nestik. Results. For generations of baby boomers, X, Y, there are similar changes in readiness for debt behavior in all areas: borrowing, lending and fulfilling obligations. Compared to the respondents surveyed before the beginning of the pandemic, there are significantly higher values (Student’s t-test, p <0.01) on the scale of “condemnation of borrowers” and significantly lower values on the “rationality of debt behavior” and “avoidance of debt” scales. The difference between generations in experiencing an epidemiological threat is the difference between generation Z and older generations. It is shown that the higher the fear of a worsening economic situation as a result of COVID-19 is, the lower the willingness to both borrow and lend is, and the higher the confidence in one’s ability to cope with difficulties and empathy for others during the pandemic are, the greater the readiness to fulfill debt obligations is.

Do Financial Inclusion, Debt Behavior Affect Business Investment? Study in Small Medium Enterprise Customers of Bank BPD Yogyakarta Indonesia

Bank, financial inclusion, debt behavior, and business investment greatly affect the economic growth of a region industry. The main purpose of this research is to examine the effect of bank behavior, financial inclusion, debt behavior on investment decisions of Micro, Small and Medium Enterprises customers at Bank BPD Yogyakarta, Indonesia. The research sample is BPD Yogyakarta customers Respondents as 200 entrepreneurs are customers who are in debt for business investment. The analysis model uses mediation regression with PLS. The results showed that bank behavior had a positive effect on financial inclusion. Bank behavior has a positive effect on debt behavior. Financial inclusion has a positive effect on business investment. Debt behavior has a positive effect on business investment. Financial inclusion, debt behavior mediates the influence of bank behavior on business investment. The implication of this research is that a clear bank behavior and high commitment of banks are needed in offering bank products. It takes commitment and supervision from the Bank in providing credit to customers so that the use of funds is in accordance with investment objectives.

The Impact of Bank Behavior, Financial Literacy on Investment Decisions, Mediation of Financial Inclusion and Debt Behavior. Study on Working Capital and Investment Debtors at Regional Development Bank Yogyakarta Indonesia

Bank behavior, financial literacy, financial inclusion, debt behavior, and investment affect the economic growth of an industry. The purpose of this research is to examine the effect of bank behavior, financial literacy, financial inclusion, debt behavior on investment decisions of working capital and investment debtors in the Regional Development Bank of Yogyakarta. Indonesia. Examine the mediating role of financial inclusion, debt behavior on investment decisions. The research sample are 280 debtors. The analysis model used mediation regression with the PLS program. The results showed that: Bank behavior has an effect on financial inclusion. Bank behavior has an effect on debt behavior. Financial literacy has an effect on financial inclusion. Financial literacy has an effect on debt behavior. Financial inclusion mediates the effect of bank behavior on investment decisions. Debt behavior mediates the effect of financial literacy on investment decisions. The managerial implication of this research is: the flexibility of providing credit to customers, must be followed by control of the use of funds. Financial literacy, financial inclusion and higher debtor debt behavior will increase the movement of the industry. The right investment will improve entrepreneurial and banking performance.

Charity and debt behaviors comparison: perception of low-income households

Purpose This paper aims to investigate low-income households in Indonesia with regard to their perspective on charity-giving and its comparison with acquiring debt behavior as their tendencies on taking and giving behaviors toward monetary form. The research framework is seen from the Islamic perspective. Design/methodology/approach Theory of social production function and theory of planned behavior are used as a theoretical framework. A total of 98.89% of the distributed questionnaires were collected and analyzed using structural equation modeling. Behavior of giving charity and acquiring debt are compared according to the given determinants. Findings Under the given Islamic framework, charity is found to be not confined to the donor’s wealth. It is rather centered on religiosity and faith. Subjective norm does not influence intention toward charity. Hence, it only depends on consideration and awareness of a person toward regular giving of charity. Unlike debt that is confined by a person’s wealth, the intention to take debt consecutively of low-income households are also affected by their attitudes, significant others and experiences. Research limitations/implications Respondents are residents of six Indonesian territories that represent West, Middle and East Indonesia. Practical implications Findings are useful for social, as well as microfinance practitioners who are interested in the financial education on low-income households and study their perspective and behavior. Social implications This paper indirectly contributes to changing the perspective of society about charity-giving, especially in philanthropy subject. This paper is also highly recommended for regulator’s input on financial education, as well as for practitioners, consultants and educators. Originality/value Charity basically can assist low-income households experiencing financial hardship, which may be the consequence of consecutive taking debt. Most of the studies on charity-giving focus on high-income households, likewise the debt behavior. Charity-giving in voluntary form is also not widely discussed in view of behavior, specifically in Asian countries like Indonesia.

Multidimensional credit attitude and credit card debt behavior in the United States

PurposeThe purpose of this study is to construct composite index variables of credit attitude using six attitudinal variables. This study also examines the relationship between consumer credit attitude and credit card debt behaviors.Design/methodology/approachThis study used the pooled dataset of the 2010 and 2013 Survey of Consumer Finances (SCF) released by the Federal Reserve Board. A total of 8,417 households were used as our analytic sample. The credit card indices were constructed using factor analysis with polychoric correlations. Factors of the credit card debt behaviors were estimated using hierarchical logistic regression models.FindingsThe results of factor analysis identified two credit attitude indices (wants and needs). The results of hierarchical logistic regression analyses show that the credit attitude indices have a positive influence on payment behaviors; households with more favorable attitudes about credit use for non-necessities (wants) were more likely to hold an outstanding credit card balance, have irregular payment practice and pay a revolving charge.Originality/valueAlthough there is ample documentation in the literature of credit behavior, the current literature is deficient in some areas for not addressing unobserved consumer attitudinal dispositions. Further, the separate treatment of selected survey items or an additive scale of survey items has been widely used; however, this approach cannot capture multidimensional characteristics among attitudinal items if credit attitude is not necessarily unidimensional. In response to the shortfall in the extant literature on credit card behavior, this study examined multidimensional aspects of credit attitude as a determinant of credit card debt behavior through methodological justification. Implications for future research and practitioners are provided.