Cultivating Self-Control in FinTech: Evidence from a Field Experiment on Online Consumer Borrowing

Di Bu, Tobin Hanspal, Yin Liao*, Yong Liu

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

Abstract

We report the results of a longitudinal intervention with students across five universities in China designed to reduce online consumer debt. We allocate participants to either a financial literacy treatment group, a self-control treatment group, or a zero-touch control group. Our self-control training intervention features detailed tracking of spending and borrowing, budgeting, and introspection about consumption choices. This intervention reduces online borrowing and delinquency charges, mainly driven by a reduction in entertainment-related spending and borrowing. In contrast, financial literacy interventions improve test scores but only marginally affect borrowing. Our results suggest that cultivating self-regulation and budgeting skills can improve borrowing behavior on e-commerce platforms.
Original languageEnglish
JournalJournal of Financial and Quantitative Analysis
Publication statusAccepted/In press - Jan 2021

Keywords

  • Self-control
  • Online borrowing
  • Consumer credit
  • FinTech
  • Financial literacy

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