Call first, pay later: stimulating debtors to contact their creditors improves debt collection in the context of financial scarcity

Malte Dewies, Astrid Schop-Etman, Inge Merkelbach, Kirsten I. M. Rohde and Semiha Denktaş

Behavioural Public Policy, 2025, vol. 9, issue 1, 88-105

Abstract: Debtors were stimulated to contact their creditors to negotiate a repayment plan. Contacting creditors was important because debtors were unlikely to repay the debt immediately and upon contacting, debtors could agree on a repayment plan to repay the debt in the long run. Using insights from scarcity theory and nudging techniques, a standard debt repayment letter was adapted and both letters were compared. Experimental results (N = 3,330) provide support for the use of nudging techniques as more debtors agreed on a repayment plan and response rates increased. The results underline the importance of stimulating debtors to contact their creditors.

Date: 2025
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