TY - BOOK ID - 136116680 TI - Moral Incentives : Experimental Evidence from Repayments of an Islamic Credit Card. AU - Bursztyn, Leonardo AU - Fiorin, Stefano AU - Gottlieb, Daniel AU - Kanz, Martin PY - 2015 PB - Washington, D.C. : The World Bank, DB - UniCat KW - Access to credit KW - Adverse selection KW - Arrears KW - Assets KW - Bank indonesia KW - Banking KW - Bankruptcy and resolution of financial distress KW - Banks and banking reform KW - Borrowers KW - Checking account KW - Collect debts KW - Collections KW - Communications KW - Consumer choice KW - Consumer choices KW - Credit card KW - Credit card debt KW - Credit control KW - Credit market KW - Current debt KW - Customer service KW - Customers KW - Debt KW - Debt forgiveness KW - Debt markets KW - Debt relief KW - Debt repayment KW - Debtor KW - Debts KW - Default KW - Deposit KW - E-Business KW - Emerging markets KW - Equity KW - Equity fund KW - Estate private sector development KW - Ethical behavior KW - Ethical global equity KW - Ethical global equity fund KW - Exchange KW - Fair trade KW - Finance and financial sector development KW - Financial development KW - Financial products KW - Forgiveness KW - Gambling KW - Global equity KW - Goods KW - Grace period KW - Grants KW - Human capital KW - Human rights KW - Income KW - Indebted KW - Indebted poor countries KW - Insurance KW - Interest KW - Interest rate KW - Interest rates KW - Interested party KW - International bank KW - Investment KW - Investment management KW - Investor KW - Islamic bank KW - Islamic law KW - Late payment KW - Law KW - Liquidity KW - Liquidity constraint KW - Loan KW - Loan repayment KW - Moral hazard KW - Moral suasion KW - Mortgage KW - New credit KW - Outsourcing KW - Outstanding debt KW - Partner bank KW - Payment KW - Payments KW - Peer pressure KW - Penalties KW - Penalty KW - Political economy KW - Portfolio KW - Price KW - Pricing KW - Property KW - Public debt KW - Real estate KW - Repayment KW - Repayment behavior KW - Repayment of debt KW - Repayment of debts KW - Repayment rate KW - Repayment rates KW - Responsible investment KW - Restructuring KW - Revenue KW - Risk KW - Saving KW - Savings KW - Savings account KW - Savings accounts KW - Services KW - Share KW - Shares KW - Socially responsible investment KW - Sovereign debt KW - Stocks KW - Student debt KW - Student loans KW - Trade KW - Usury laws UR - https://www.unicat.be/uniCat?func=search&query=sysid:136116680 AB - This paper studies the role of morality in the decision to repay debts. Using a field experiment with a large Islamic bank in Indonesia, the paper finds that moral appeals strongly increase credit card repayments. In this setting, all of the banks late-paying credit card customers receive a basic reminder to repay their debt one day after they miss the payment due date. In addition, two days before the end of a ten-day grace period, clients in a treatment group also receive a text message that cites an Islamic religious text and states that "non-repayment of debts by someone who is able to repay is an injustice." This message increases the share of customers meeting their minimum payments by nearly 20 percent. By contrast, sending either a simple reminder or an Islamic quote that is unrelated to debt repayment has no effect on the share of customers making the minimum payment. Clients also respond more strongly to this moral appeal than to substantial financial incentives: receiving the religious message increases repayments by more than offering a cash rebate equivalent to 50 percent of the minimum repayment. Finally, the paper finds that removing religious aspects from the quote does not change its effectiveness, suggesting that the moral appeal of the message does not necessarily rely on its religious connotation. ER -