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Online Banking Users vs. Branch Visitors: Why Are Their Portfolio Returns Different?

Author

Listed:
  • Nagano, Mamoru
  • Uchida, Yuki

Abstract

This study investigates why portfolio returns of online banking users are higher than those of non-online users. We first demonstrate that households that are eager to improve their level of financial literacy are more likely to use online banking. Second, a marginal increase in risk appetite increases portfolio returns of online users; however, this is not the case for non-online users. Third, online banking promotes debt repayment, and this further encourages risk tolerant investments. In sum, we conclude that financial literacy efforts moderate a positive relationship between use of online banking, risk appetite, and portfolio returns. The positive relationship between use of online banking and debt repayment further increases risk appetite.

Suggested Citation

  • Nagano, Mamoru & Uchida, Yuki, 2021. "Online Banking Users vs. Branch Visitors: Why Are Their Portfolio Returns Different?," MPRA Paper 105531, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:105531
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    References listed on IDEAS

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    More about this item

    Keywords

    Online Banking; Portfolio Investmen; Risk Appetite; Debt Repayment; Mortgage Debt;
    All these keywords.

    JEL classification:

    • G00 - Financial Economics - - General - - - General
    • G02 - Financial Economics - - General - - - Behavioral Finance: Underlying Principles
    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions

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