Fintech, Visual Attention, and Financial Inclusion: A Field Experiment on Migrant Remittances
Discipline: Social, Behavioral, and Economic Sciences
Session: 1
Room: 2 - Inman
Hannah Hailemicael - Spelman College
Co-Author(s): Angelino Viceisza, Spelman College, Atlanta, Georgia.
Migrant remittances to low- and middle-income countries were close to 650 billion US dollars in 2022, impacting about one billion people worldwide. Despite this, sending remittances remains relatively costly. Policymakers have argued that fintech, specifically comparison websites like kayak.com but for sending money, can boost financial inclusion and reduce remittance prices. However, little is known about how a key segment of consumers – migrants with limited (financial) education and trust in digital methods –interacts with fintech. We collaborate with a World Bank-certified comparison website to conduct a field experiment among Central American migrants. We vary remittance-company attributes shown to migrants on a comparison website, specifically, the time to delivery and customer reviews, to assess the potential for fintech to impact their choices. We use visual attention data to assess how search leads to such choices. We find that (1) while 10-28 percent of migrants exhibit some remittance habit, more than half experiment with companies once provided with fintech information, (2) while the migrant response to information is rational and their search seems targeted, there is considerable heterogeneity – those with no prior awareness of comparison sites or low financial literacy are less likely to respond to customer reviews and those with low information-processing capability are less likely to respond to delivery speed, and(3) when presented with fintech information, migrants are 44 percent more likely to behave counter to the preferences over attributes they exhibit outside of the study. As such, they pay 20-30 percent more despite typically shopping around for the cheapest company. The findings thus paint a nuanced picture of the potential for fintech to improve financial inclusion and consumer welfare among this demographic.
Funder Acknowledgement(s): The project was funded by the National Science Foundation EAGER Award 1649921.
Faculty Advisor: Angelino Viceisza, aviceisz@spelman.edu
Role: My primary role in this project has been supporting data analysis as a research assistant a part of VLab.