THE IMPACT OF THE WIDESPREAD ADOPTION OF DIGITAL PAYMENT SYSTEMS ON INDIVIDUAL SPENDING HABITS AND SAVINGS

Purpose - The aim of the study is to examine the impact of digital payment systems on individual savings rates and spending habits in Türkiye. Additionally, it is to evaluate the impact of digital payment systems on individual spending and savings within the framework of the COVID-19 crisis. Methodology - The research aims to examine the impact of digital payment systems on individual savings rates and spending habits by adopting a quantitative approach. Additionally, as a sub-objective, it aims to evaluate the impact of digital payment systems on individual spending and savings within the framework of the COVID-19 crisis. In the study, quarterly data for the period 2016Q1-2023Q4 were analyzed using household consumption expenditures, gross savings amount, digital payment systems (mobile payment, online banking, contactless payments, and all other digital payment methods), consumer price index, deposit interest rate, consumer credit interest rate, and consumer confidence index. The Newey–West Standard Errors Estimator has been used for data analysis. Findings - It has been shown digital payment systems have a statistically significant and positive effect on household final consumption expenditures and gross savings. Again, it has been concluded the pandemic period had a statistically significant and negative impact on household final consumption expenditures and gross savings. Additionally, it has been observed digital payment systems had an impact on increasing household consumption expenditures and savings during the pandemic period. Conclusion - - In the study, the effects of digital payment systems in Turkey on individual savings rates and spending habits were examined. The findings obtained indicate that digital payment systems have a statistically significant and positive impact on household final consumption expenditures and gross savings. In addition, it has been determined that the COVID-19 pandemic has a statistically significant and negative impact on household consumption expenditures and gross savings. Additionally, it has been observed that digital payment systems played a positive role in increasing individuals' consumption expenditures and savings during the pandemic period. These findings reveal how digital payment infrastructure shapes individuals' financial behaviors during times of crisis, providing an important foundation for future research examining the interaction between digital finance and crisis dynamics.