The use of formal financial services has been associated with increased financial wellbeing and overall economic growth. Efforts to increase financial inclusion have emphasized financial literacy provided through formal training and education without due recognition that people’s financial behaviors and practices may be motivated by social interactions. The current study examines the moderating effects of social learning on the relationship between financial literacy and formal financial services usage within a developing country context. Survey data collected from a sample of 351 adults in Kampala, Uganda, was analyzed using Pearson correlation coefficients, hierarchical regression, and ModGraph. Findings reveal significant positive relationships between financial literacy, social learning, and usage of formal financial services. Results indicate that social learning moderates the relationship between financial literacy and financial services usage among people in Kampala. The study finds peers and friends to be critical socializing agents with a significant influence on formal financial services usage. Beyond the promotion of financial literacy, financial inclusion initiatives should recognize the effects of social learning to increase the use of formal financial services in countries such as Uganda. The study integrates aspects of the social learning theory into the financial services domain hitherto dominated by finance and economic models.
Key words: Financial literacy, financial inclusion, Uganda