Digital Literacy as a Moderator of the Nexus Between Social Media Engagement and Internet Banking Adoption in Cameroon

The increasing use of social media by financial institutions has created opportunities to promote digital banking services; however, exposure to banking-related information does not necessarily result in consistent internet banking adoption. This study examines the moderating effect of digital literacy on the relationship between social media engagement and internet banking adoption in Cameroon. It is principally grounded in the Technology Acceptance Model, Diffusion of Innovation Theory and Digital Capability/Digital Divide perspectives. A quantitative cross-sectional design was adopted, with primary data collected from 399 current and potential internet banking users among customers of commercial banks and microfinance institutions in Buea, Cameroon. Social media engagement, digital literacy and internet banking adoption were measured using multiple-item five-point Likert scales. Structural Equation Modelling and bootstrapping with 5,000 resamples were employed to estimate the direct and interaction effects. The findings indicate that social media engagement and digital literacy independently have positive effects on internet banking adoption. More importantly, the interaction between social media engagement and digital literacy is positive and statistically significant, demonstrating that higher digital literacy strengthens the effect of social media engagement on internet banking adoption. The inclusion of the interaction term also enhances the model’s explanatory power. The study concludes that the effectiveness of social media communication in promoting internet banking partly depends on customers’ ability to understand, evaluate and apply digital information.