Every Payment Counts: Prize-Linked Debt Reduction

Last registered on May 18, 2018
View Trial History

Pre-Trial

Trial Information

General Information

Title
Every Payment Counts: Prize-Linked Debt Reduction
RCT ID
AEARCTR-0001673
Initial registration date
November 08, 2016

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
November 08, 2016, 1:32 PM EST

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

Last updated
May 18, 2018, 9:59 AM EDT

Last updated is the most recent time when changes to the trial's registration were published.

Locations

Country
United States of America
Region

Primary Investigator

Name
Jeremy Burke
Affiliation
University of Southern California, Center for Economic and Social Research
Contact Primary Investigator

Other Primary Investigator(s)

Additional Trial Information

Status
On going
Start date
2015-10-01
End date
2019-06-01
Keywords
Finance & Microfinance
Additional Keywords
debt repayment, behavioral finance, prize linked incentives, behavioral economics
JEL code(s)
D12, G29
Secondary IDs
Abstract
Can prize-linked incentives improve financial behavior? We are working with a large not-for-profit credit counseling agency to examine whether lottery linked incentives can improve debt repayment behavior. Randomly selected participants in the credit counseling agency's debt management plan (DMP) are receiving access to a program that links on-time debt repayment behavior with a small chance of debt forgiveness. We plan to evaluate the impacts of prize-linked incentives on DMP retention, debt reduction, defaults, delinquencies and programmatic financial self-sustainability.
External Link(s)

Registration Citation

Citation
Burke, Jeremy. 2018. "Every Payment Counts: Prize-Linked Debt Reduction." AEA RCT Registry. May 18. https://doi.org/10.1257/rct.1673-2.0
Former Citation
Burke, Jeremy. 2018. "Every Payment Counts: Prize-Linked Debt Reduction." AEA RCT Registry. May 18. https://www.socialscienceregistry.org/trials/1673/history/29684
Sponsors & Partners

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Experimental Details

Interventions

Intervention(s)
Intervention Start Date
2016-01-01
Intervention End Date
2017-01-01

Primary Outcomes

Primary Outcomes (end points)
1) Timely debt repayment, including percentage of on-time monthly DMP payments and percentage of monthly DMP payments made in full;
2) Total debt;
3) DMP retention;
4) Credit access, including FICO score, number of open credit lines, percentage of credit utilization, debt balance, delinquencies and collections, debt payments and interest paid on other loans
4) Programmatic financial self-sufficiency
Primary Outcomes (explanation)
We will examine whether increased revenue through increased retention and reduced delinquency offset the amount of money awarded in prizes

Secondary Outcomes

Secondary Outcomes (end points)
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
Study participants were randomized into one of two groups: 1) Control: These clients will not receive an offer to participate in the PLDR program. 2) Treatment: These clients will receive an offer to participate in the PLDR program. Enrolled participants that make their full payment are entered into monthly drawings, and a Grand Prize drawing at the end of the year.The prizes will go directly towards repayment of the client's debt management plan (DMP). Participating clients will also receive monthly emails from the agency, which will include information about the previous month's winner and a reminder about upcoming drawings. To participate, treatment clients must actively opt-in via phone or email.
Experimental Design Details
Randomization Method
Individual clients were randomized in Stata. Randomization depended on the client’s DMP start date; clients who started a DMP between January through March 2014 and January through March 2015 were batch randomized in December 2015. Clients who started a DMP between January through March 2016 were randomized on a rolling, weekly basis based on enrollment information from the partner.
Randomization Unit
Client
Was the treatment clustered?
No

Experiment Characteristics

Sample size: planned number of clusters
6800 clients
Sample size: planned number of observations
6800 clients
Sample size (or number of clusters) by treatment arms
3,477 control clients and 3,511 treatment clients
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
Supporting Documents and Materials
IRB

Institutional Review Boards (IRBs)

IRB Name
Innovations for Poverty Action
IRB Approval Date
2015-12-18
IRB Approval Number
13954
Analysis Plan

Post-Trial

Post Trial Information

Study Withdrawal

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Intervention

Is the intervention completed?
No
Data Collection Complete
Data Publication

Data Publication

Is public data available?
No

Program Files

Program Files
Reports, Papers & Other Materials

Relevant Paper(s)

Reports & Other Materials