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Inattention and credit card repayment date

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  • Jiang, Jiajun
  • Lee, Yi-Tsung
  • Liu, Yu-Jane
  • Meng, Juanjuan

Abstract

This paper presents an analysis of how inattention affects credit card repayment dates. Data from an Asian commercial bank reveal that 70 % of repayments are made prior to the due date and 21 % are late. We show that exogenous reductions in attention levels, stemming from weekday-weekend variations in billing dates and natural disasters, amplify late repayments and diminish early repayments. We find that early repayments are not random errors, and consumers learn to pay earlier or sign up for automatic payment after historical delays. We introduce a model based on inattention and heterogeneous awareness to explain these findings.

Suggested Citation

  • Jiang, Jiajun & Lee, Yi-Tsung & Liu, Yu-Jane & Meng, Juanjuan, 2025. "Inattention and credit card repayment date," Journal of Economic Behavior & Organization, Elsevier, vol. 230(C).
    • Handle: RePEc:eee:jeborg:v:230:y:2025:i:c:s0167268125000265
    DOI: 10.1016/j.jebo.2025.106906
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    References listed on IDEAS

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    More about this item

    Keywords

    Inattention; Sophistication; Awareness; Credit card repayment; Learning;
    All these keywords.

    JEL classification:

    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • G41 - Financial Economics - - Behavioral Finance - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making in Financial Markets

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