Journal of African Development

Purpose: This review examines how financial literacy relates to retail investment decisions in India and selected Asian economies. It distinguishes demonstrated knowledge from confidence and considers risk perception, behavioural biases, advice and digital investing.

Design/methodology/approach: This comparative integrative review interprets 24 illustrative empirical sources: 20 from Asian settings and four external comparators. Studies on retail investment decisions form the core; research on broader financial capability provides context. The sources are grouped by literacy measurement, participation, risk, trading, behavioural bias, demographic variation, advice and digital channels. The selection is purposive and does not claim exhaustive retrieval.

Findings: Objective literacy is associated in several studies with market participation, portfolio choice and planning, while perceived literacy and confidence can influence willingness to act. The link between literacy and decision quality is conditional: overconfidence, herding and loss aversion may persist. Gender and age patterns also reflect confidence, opportunity, experience and household roles. Digital access changes both opportunities and information risks. Evidence for specific biases differs across settings.

Research limitations: Most investor studies in the assembled literature use cross-sectional surveys and self-reported outcomes. Measures and samples vary, direct cross-country comparisons are scarce, and purposive source selection may omit relevant work. The synthesis does not establish causal effects or pooled effect sizes.

Practical implications: Investor education should address product knowledge, realistic confidence, risk appraisal and source verification. Platforms and advisers can support decisions through clear disclosures, suitable prompts and accessible advice, particularly for first-time investors.

Originality/value: The review brings together knowledge, confidence, behavioural control and information quality in a calibrated financial-literacy framework. It specifies why greater knowledge need not translate directly into better investment decisions