A simple automated robo-advice tool significantly improved borrower repayment decisions in a randomised controlled trial, according to research from the Financial Conduct Authority (FCA) economists.
The FCA conducted a robo-advice experiment online, with nearly 3,500 participants representative of the UK population. According to the analysis, many individuals reported they were willing to pay more for the tool than its monetary benefit, potentially suggesting a significant mental cost to consumers in juggling debts and making repayment decisions. The regulator highlighted that concerns about consumer indebtedness and financial distress were growing against the backdrop of a severe cost of living crisis. "More people will find themselves borrowing to make ends meet and then potent...
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