The Financial Polemics of African Refugee Livelihoods in Places of Resettlement: A Transformative Mixed Methods Study

Background: Refugees face unique challenges in financial service utilization given language barriers, cultural factors, immigration status, experiences of financial institutions in their home country, and international financial transactions they often need to conduct. Although economic integration experiences among refugee sub-populations vary, there is a paucity of studies examining resettlement challenges and financial well-being among African refugees. Using the financial capability lens, our study aims to: (a) explore the relationships between financial stress, financial literacy, and financial self-efficacy that characterize patterns of financial well-being in the post-resettlement context; (b) understand the financial conditions that contribute to financial stress; and (c) garner a community-grounded culturally responsive solution targeted to African refugees.

 Methods:  We used a transformative explanatory sequential mixed method design in three phases. Quantitative data were first collected through a community survey among African refugees (N =130). Bi-variate analyses were then, conducted to explore the relationship between the financial domain variables. In the second phase, qualitative data were collected via two focus group discussions (FGD) with a sample of community survey participants (N=11) and local service providers (N =12). Both FGDs were audio recorded and transcribed verbatim. Qualitative data analysis followed the Rapid and Rigorous Qualitative Data Analysis process that generated five overarching themes. In the third phase, both the qualitative and quantitative data were converged to validate the moderating effect of financial literacy—a community driven solution generated by FGDs. A moderation analysis using PROCESS Macro was conducted to test the moderation effect of financial literacy on the relationship between financial stress and financial self-efficacy.

Results: Findings expanded our understanding of the multifaceted phenomenon of financial well-being in the African refugee context. Refugees with higher levels of financial literacy reported higher levels of financial self-efficacy (M = 8.77) compared to respondents with lower levels of financial literacy (M = 7.61). By contrast, refugees with higher levels of financial literacy reported lower levels of financial stress (M = 6.40) compared to respondents with lower levels of financial literacy (M = 7.81).  Financial stress was negatively correlated with financial self-efficacy (r = -.40, p < .001) and financial literacy (r = -.38, p < .001). We found a significant moderating effect of financial literacy on the relationship between financial self-efficacy and financial stress (β = -.37, p < .05). Financial self-efficacy, financial literacy, and the interaction effect accounted for 54% of the variance on financial stress (R2 = .54, F = 15.16, p < .001). Findings revealed that culturally responsive financial literacy is an urgent need among the African refugee population.

Implications: Building financial capability among refugees so they understand the financial and social systems of host societies will help them successfully manage personal finances and become active participants in economic systems. Given the increasingly complex financial inequities, development of culturally responsive financial literacy programs geared towards building financial capability of refugee households to maximize well-being, is therefore crucial. Findings of our study provide insights into how policy and practices can be inclusive of these new and valuable members of U.S. society.