Too fast, too furious? Digital credit delivery speed and repayment rates

• 成果类型: Article
• 署名作者: Burlando, Alfredo; Kuhn, Michael A.; Prina, Silvia
• 署名单位: University of Oregon; University of Oregon; Northeastern University; IZA Institute Labor Economics
• 刊物名称: JOURNAL OF DEVELOPMENT ECONOMICS
• ISSN/ISSBN: 0304-3878
• DOI: 10.1016/j.jdeveco.2024.103427
• 发表日期: 2025
• 关键词: Digital credit; Waiting periods; defaults; Financial access

摘要

Digital loans area source of fast, short-term credit for millions of people. While digital credit broadens market access and reduces frictions, default rates are high. We study the role of the speed of delivery of digital loans on repayment. Our study uses unique administrative data from a digital lender in Mexico and a regression- discontinuity design. We show that reducing loan speed by doubling the delivery time from ten to twenty hours decreases the likelihood of default by 21%. A number of the plausible mechanisms could explain these results. The one that best support our data is that following an unexpected delay, borrowers switch their preferred use of loans in away that improves the chances of repayment. Our findings suggest that waiting periods used to selectively slow down credit could improve lender profitability and help consumers avoid default.