Determinants of Embedded Finance (Buy Now Pay Later) Adoption Intention among E-Commerce Consumers: A UTAUT2 Model with Financial Self-Efficacy Moderation

Abstract

The proliferation of embedded finance, notably Buy Now Pay Later (BNPL) installment schemes across digital marketplace ecosystems, has reshaped consumer micro-credit paradigms in Indonesia. Frictionless algorithmic underwriting and flexible tenure options catalyze transactional velocities, yet simultaneously provoke concerns regarding over-indebtedness and impulsive consumption among younger demographics. This study investigates the determinants of BNPL adoption intention utilizing the extended Unified Theory of Acceptance and Use of Technology 2 (UTAUT2) framework, examining financial self-efficacy as a moderating condition. An explanatory quantitative survey was administered to 230 active e-commerce shoppers in North Sulawesi. The empirical data were evaluated via Partial Least Squares Structural Equation Modeling (PLS-SEM) in SmartPLS 4.0. The findings confirm that Performance Expectancy (β = 0.272, p < 0.001), Habit (β = 0.285, p < 0.001), and Hedonic Motivation (β = 0.314, p < 0.001) exert significant positive effects on BNPL adoption intention. Crucially, financial self-efficacy exerts a statistically significant negative moderating effect on the link between hedonic motivation and BNPL adoption intention (β = -0.158, p = 0.008). This establishes that consumers possessing elevated financial self-efficacy actively temper hedonic impulses toward leveraging speculative digital credit. The structural model explains 58.6% of the variance in BNPL adoption intention (R² = 0.586). Policy recommendations emphasize mandatory algorithmic credit-limit cooling-off periods and heightened interest-rate transparency.