Nudging a second after

This paper studies a novel method to help people make better decisions by providing information immediately after customers make a costly transaction. We examine an intervention by a major financial institution in Australia, where credit card customers in a treatment group received a text message immediately after each high-cost transaction. The notification informed them that the transaction resulted in an additional fee and that a higher interest rate would apply immediately. This immediate ex-post information nudge reduces the number of subsequent high-cost transactions by 6% and increases the likelihood of making a repayment on the day they were nudged by 5%. This evidence is consistent with the ex-post information campaign increasing awareness among customers about the fees and higher interest rate which subsequently caused them to adjust their credit card usage to save money. More generally, this evidence provides a novel method to help people make better decisions by nudging immediately after rather than before an event.