The Influence of FOMO (Fear of Missing Out), Instant Gratification, and Financial Literacy on Buy Now Pay Later (BNPL) Usage among Generation Z University Students in Indonesia
Keywords:
Buy Now, Pay Later, Fear of Missing Out, Instant Gratification, Financial Literacy, Generation Z, PLS-SEMAbstract
This study examines the psychological and capability-based factors that influence the adoption of Buy Now, Pay Later (BNPL) among Generation Z university students in Indonesia. Drawing on the Stimulus–Organism–Response perspective, present-bias, and a light extension of the Theory of Planned Behaviour, we investigate how Fear of Missing Out (FOMO), instant gratification, and financial literacy shape actual BNPL behaviour. A cross-sectional survey of 230 students was analysed using partial least squares structural equation modelling with bootstrapping (5,000 subsamples) and two-stage interactions. The measurement model met conventional reliability and convergent validity thresholds. Structurally, FOMO strongly increased instant gratification (β=0.757), while BNPL usage was positively predicted by financial literacy (β=0.400) and instant gratification (β=0.338); the direct path from FOMO to BNPL was also significant (β=0.395). Mediation testing confirmed a significant indirect effect of FOMO on BNPL through instant gratification (O = 0.256; p = 0.047). Moderation by financial literacy was limited: the FOMO × financial literacy term was marginal, and the instant gratification × financial literacy term was not significant. The model demonstrated substantial explanatory and predictive power (R²_BNPL = 0.700; Q²_BNPL = 0.418). These results suggest that present-oriented motives, amplified by social and promotional cues, are central to BNPL engagement. At the same time, financial literacy functions more as an enabling capability than a strict deterrent. The study offers actionable guidance for ethical interface design and targeted literacy interventions in higher education settings.
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