Bridging the Cultural Divide: The Role of Digital Financial Inclusion in Robo-Advisory Services

Abstract

Financial technology (FinTech) is transforming wealth management through robo-advisory services, leveraging artificial intelligence for cost-effective financial guidance. However, cultural values and financial literacy significantly influence adoption, particularly in emerging markets. This study examines the role of cultural perceptions, financial literacy, trust in AI, and perceived risk in robo-advisory adoption using Structural Equation Modeling (SEM) on data from 380 UAE respondents. The findings confirm that individualism and low uncertainty avoidance foster adoption, whereas collectivist and high uncertainty avoidance cultures exhibit reluctance. Financial literacy enhances adoption but does not moderate cultural influences, indicating the persistence of cultural norms despite financial knowledge. Trust in AI boosts adoption, while perceived risk deters engagement. These insights emphasize the need for culturally adaptive FinTech solutions, trust-building measures, and regulatory enhancements in AI transparency and cybersecurity. Future research should explore financial behavior trends and cross-cultural comparisons to advance global digital financial inclusion.