Digital literacy is increasingly recognised as a crucial skill for urban youth in Lagos, Nigeria, especially when it comes to engaging with technology-driven financial services (TDFS). However, there remains an uneven distribution of such digital skills among youth populations. The study employs a qualitative approach, utilising semi-structured interviews with a purposive sample of urban youth aged 18-25 who have access to TDFS services in Lagos. Data collection was conducted over three years, focusing on themes such as digital literacy levels and perceived benefits or barriers. During the study period, it was observed that approximately 40% of participants demonstrated high levels of digital literacy, which correlated with their active use of TDFS services. However, there were significant disparities in digital skills between urban youth from different socioeconomic backgrounds. This analysis reveals a nuanced understanding of the digital divide affecting urban youth's engagement with TDFS and highlights the need for more targeted educational programmes to bridge this gap. Based on these findings, we recommend the implementation of community-based digital literacy initiatives that are tailored to meet the specific needs of diverse youth populations in Lagos.