Targeting Higher Credit Card Payments

Last registered on September 24, 2024

Pre-Trial

Trial Information

General Information

Title
Targeting Higher Credit Card Payments
RCT ID
AEARCTR-0014102
Initial registration date
September 09, 2024

Initial registration date is when the trial was registered.

It corresponds to when the registration was submitted to the Registry to be reviewed for publication.

First published
September 24, 2024, 2:45 PM EDT

First published corresponds to when the trial was first made public on the Registry after being reviewed.

Locations

Region

Primary Investigator

Affiliation
Rice University

Other Primary Investigator(s)

Additional Trial Information

Status
In development
Start date
2024-09-11
End date
2027-09-11
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Abstract
A large body of lab experimental evidence exists showing that a nudge shrouding the credit card minimum payment option increases hypothetical manual credit card payments. I conduct a new field experiment to test whether this finding extrapolates to increase credit card payments in the field. I test two nudges that help to understand the credit card payment amounts that consumers target.
External Link(s)

Registration Citation

Citation
Guttman-Kenney, Benedict. 2024. "Targeting Higher Credit Card Payments." AEA RCT Registry. September 24. https://doi.org/10.1257/rct.14102-1.0
Experimental Details

Interventions

Intervention(s)
Intervention Start Date
2024-09-11
Intervention End Date
2025-01-31

Primary Outcomes

Primary Outcomes (end points)
Payment (%)
Primary Outcomes (explanation)
Continuous outcome defined as the sum of payments ($) divided by the statement balance ($). Payment (%) is given a value of one if statement balance is zero. If Payment (%) is greater than one, it is winsorized at a value of one.

Secondary Outcomes

Secondary Outcomes (end points)
2. Payments ($): Continuous outcome.

3. Statement Balance ($): Continuous outcome.

4. Spending ($): Continuous outcome defined as the sum of purchases ($).

5. Spending (%): Continuous outcome defined as the sum of purchases ($) divided by the statement balance ($). Spending (%) is given a value of one if statement balance is zero. If Spending (%) is greater than one, it is winsorized at a value of one.

6. Debt ($): Continuous outcome measuring revolving credit card debt. This is defined as the statement balance ($) less payments ($). Debt is given a value of zero if payments exceed the statement balance.

7. Credit Limit ($): Integer outcome.

8. Miss Pay: Binary outcome. Takes a value of one if the consumer’s payments are zero or less than the minimum payment (and the minimum payment is non-zero, and the payments are less than the statement balance).

9. Pay Min: Binary outcome. Takes a value of one if the consumer’s payments are only exactly the minimum payment (and the minimum payment is non-zero, and the payments are less than the statement balance).

10. Pay 50%: Binary outcome. Takes a value of one if the consumer’s payments are only exactly the 50% of the statement balance (and the minimum payment is non-zero).

11. Pay Full: Binary outcome. Takes a value of one if the consumer’s payments are for the full statement balance or more (or if a zero minimum payment is due, including cases of zero statement balances).

12. Pay Current: Binary outcome. Takes a value of one if the consumer’s payments are for the current balance or more (if current balance is non-zero).
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
The experiment varies the presentation of the credit card manual payment options a consumer is presented with on the lender’s mobile app. I test two treatments Treatment 1 (T1) and Treatment (T2) against a control group (C). These are described in the pre-analysis plan.
Experimental Design Details
Not available
Randomization Method
Randomized using random number generator on computer.
Randomization Unit
Randomized at the consumer-level.
Was the treatment clustered?
No

Experiment Characteristics

Sample size: planned number of clusters
N/A
Sample size: planned number of observations
At least 3,300 in total.
Sample size (or number of clusters) by treatment arms
At least 1,100 consumers are randomly selected for each of the two treatment groups. The control group consists of the remaining consumers and will contain at least 1,100 consumers.
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
Based on data from June 2024, a sample of 2,200 consumers evenly split between a control and a treatment group would have sufficient power to detect a change in payments of 0.045, given a baseline mean of 0.235 and a standard deviation of 0.372. It would have sufficient power to detect a change in revolving debt of $26, given a baseline mean of $214 and a standard deviation of $221.
IRB

Institutional Review Boards (IRBs)

IRB Name
Rice University Institutional Review Board
IRB Approval Date
2024-06-21
IRB Approval Number
IRB-FY2024-399
Analysis Plan

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