The role of Robo-advisors in enhancing investor literacy and financial decision-making

This study investigates the influence of robo-advisors on financial literacy and systematic investment behavior among retail investors in the United Arab Emirates (UAE). It aims to evaluate whether the adoption of robo-advisory platforms translates into improved investor knowledge and disciplined financial behavior. A descriptive-correlational research design was employed, integrating both quantitative and qualitative methods. Data were collected through a structured survey administered to 150 retail investors in the UAE. The responses were analyzed using correlation analysis and thematic qualitative techniques to identify key patterns and relationships. The analysis reveals that financial literacy is a significant predictor of systematic investment behavior, whereas robo-advisor usage alone does not result in statistically significant improvements. Correlation results indicate stronger associations between investment discipline and both income level and financial literacy, compared to technology adoption. Thematic analysis highlights that trust, ease of use, and limited human interaction are critical factors shaping investor perceptions of robo-advisory services. Robo-advisory platforms, while beneficial in terms of accessibility and cost-effectiveness, do not inherently foster improved financial behavior. Effective behavior change requires more than technological solutions and should incorporate features that support cognitive engagement and learning. The findings underscore the importance of integrating behavioral reinforcement tools such as financial education modules, personalized nudges, and feedback mechanisms into robo-advisory platforms. Financial technology developers and policymakers should focus on holistic design strategies that enhance both investor knowledge and behavior.