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Increasing loan repayments

This story is about a fintech startup called EarnUp whose mission is to help people repay their mortgages faster.

Behavioral scientists at the Common Cents Lab partnered with fin-tech startup EarnUp to help them attract users and kickoff.

  • EarnUp’s value proposition: to help Americans pay off their home mortgages faster and increase long-term savings.

  • EarnUp’s technology: software that intelligently syncs users’ income and expenses.

Together they sought to answer these two questions: 1. How can we attract users, i.e., make “saving on mortgage payment” appealing? 2. How can we prompt people to actually increase their loan payments?

Here's what they did:

Step 1. Behavioral diagnosis. Analysis of existing data revealed the following insight: Some customers were already paying more than their required mortgage payment. Why? Because they rounded up their mortgage payment to the nearest $5 or $10.

Step 2. Literature review. Behavioral insights have consistently shown the strong tendency of households to use heuristics to simplify financial matters. Rounding is one heuristic found to be useful for as an easier alternative to complex budgeting.

Step 3. Think of possible interventions. For the first question (how to attract users), they formed the following hypothesis: Framing the company’s message from “saving money” to “earning money” would be more appealing to users. For the second question (how to get users to pay more on their loans), the hypothesis was as follows: Prompting people to round to psychologically satisfying numbers would cause people to pay more on their loans, compared to simply telling them to overpay.

Step 4. Run experiments to test interventions. Experiment 1: By making a slight language adjustment to EarnUp’s online advertising materials. (reframing the value proposition from “save money on a mortgage” to “earn money back from a mortgage”) they were able to increase click-through rates on their online ads by 59%. The success of this experiment prompted the company to change its name from APASave (as it was prior to the study) to EarnUp. Experiment 2: They sent emails to a random selection of 3000 of EarnUp’s active user base. The main body of the email told users:

  • how much the average EarnUp customer saves when they overpay their loan

  • their next payment amount, and

  • a message asking them to contact EarnUp to start overpaying.

Users were split into two conditions, a rounding condition and a control group.

  • For participants in the rounding condition, the email prompted them to round up their monthly payments.

  • For participants in the control condition, in the email they were simply prompted to overpay (without any mention of rounding).

The results?

  • The “round up” framing increased the number of people who opted in by 3.1% over the control.

  • Both groups increased regular payments by an additional 10%, simply by receiving the email – a simple prompt that was designed considering the power of social norms, customized information and reminders.

Step 5. Measure the impact. This interventions saved the average EarnUp user about $8,000 over the life of their loan. That is approximately $1,300,000 in interest saved for users who opted to round up or overpay in the experiment. 86% of people who opted to overpay had never previously committed to overpaying on their loans. These consumers are now on a new automated path to savings and financial well-being.


  1. Framing matters. Reframing the value proposition from “save money on a mortgage” to “earn money back from a mortgage” makes it more appealing and attracts users (59% ⬆)

  2. Reaching out to people and asking them works. Provided you do it the right way. What is the right way?

  • Social norms influence. By referencing what other people do (“how much the average EarnUp customer saves when they overpay their loan”) can help take action.

  • Providing customized information helps. Informing people of their next payment amount helps make it easy for them to make a decision at that point (instead of searching to find that information).

  • Making it easy and timely. The email gave specific information of how people could contact EarnUp right now and start overpaying on their loan. Making it easy and timely helped those people who may have had the intention to start paying a bit more on their loan but never got to it, helping to bridge the intention-action gap.

The EAST Framework
If you want to encourage a behavior, make it Easy, Attractive, Social and Timely (EAST framework developed by UK’s Behavioural Insights Team).
In this specific case, here are the elements of the EAST framework that helped EarnUp and its users:
Make it Easy. Reduce the ‘hassle factor’ of taking up a service. The effort required to perform an action often puts people off. Reducing the effort required can increase uptake or response rates. Also, making the message clear often results in a significant increase in response rates to communications.
Make it Attractive. We are more likely to do something that our attention is drawn towards. The words used matter (framing) as does personalization.
Make it Social. Describing what most people do in a particular situation encourages others to do the same.
Make it Timely. Help people plan their response to events. There is a substantial gap between intentions and actual behavior. A proven solution is to prompt people to identify the barriers to action, and develop a specific plan to address them.


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