How Do Financial Literacy, Behavioral Biases, and Social Media Exposure Interact to Influence Young People’s Vulnerability to Financial Scams in Emerging Economies?
Assem Issina
31/08/2026
The present literature review explores the relationship between financial literacy, psychological biases, and digital media as the main factors shaping youth vulnerability to financial fraud in developing countries. Although financial literacy is traditionally considered the key safeguarding measure against financial risks, recent academic sources increasingly claim that the problem lies in the emotional context in which people behave, rather than their lack of knowledge and awareness. Individuals can have sufficient information about finance yet act irrationally because of their overconfidence, herding tendencies, and FOMO.
Digital media, namely social media, appears to be one of the key tools via which the population gets acquainted with financial information and investment opportunities. Various financial influencers, entertaining short videos, luxurious lifestyles, and inspiring success stories create the illusion of credibility and legitimacy of potentially dangerous operations. The problem becomes even more complicated due to fast digital financial inclusion and low availability of high-quality financial education in developing economies.
In methodological terms, this review follows a PRISMA-influenced systematic approach by using academic databases (Google Scholar, Scopus, ResearchGate) and institutional databases between 2014 and 2026. The reviewed materials include scholarly literature on the topic and macroeconomic data from the World Bank Global Findex Database and S&P Global Financial Literacy Survey. The key message emerging from the reviewed literature is that youth vulnerability to financial fraud is best understood through the interplay of three elements: lack of knowledge, cognitive biases, and digital media. Therefore, the issue can be addressed only by a multi-faceted approach to protecting individuals.