Artificial Intelligence in Behavioural Finance and Financial Literacy: An Empirical Study on Investor Decision-Making and Financial Awareness

Resumen

The rapid digitalisation of financial services has significantly altered the way individuals perceive, process, and act upon financial information. Behavioural finance highlights that financial decisions are often influenced by cognitive biases, emotions, and heuristics rather than rational evaluation alone. In recent years, Artificial Intelligence (AI) has emerged as a powerful enabler in addressing these behavioural inefficiencies by offering personalised insights, predictive analytics, and adaptive financial learning tools. Despite the growing adoption of AI-driven financial applications, limited empirical research exists on how AI influences behavioural biases and financial literacy simultaneously, particularly in emerging economies. The present study aims to examine the role of Artificial Intelligence in behavioural finance with specific reference to its impact on financial literacy and investor decision-making. The study identifies key behavioural biases such as overconfidence, loss aversion, herding, and present bias, and analyses how AI-based tools assist individuals in recognising and mitigating these biases. A structured questionnaire-based survey method is proposed to collect primary data from individual investors and working professionals using AI-enabled financial platforms. Descriptive statistics, factor analysis, and regression analysis are suggested to assess the relationship between AI usage, behavioural responses, and levels of financial literacy. The study is expected to contribute to behavioural finance literature by integrating technological intervention into behavioural models of financial decision-making. It offers practical implications for policymakers, fintech developers, and financial educators by highlighting how AI-driven financial tools can promote informed decision-making, enhance financial awareness, and foster long-term financial well-being. The findings may support the development of inclusive and responsible AI-based financial education frameworks.