We use an RD research design that exploits credit that is lender-specific discontinuities.


Utilizing an unique information set comprising near all U.K. cash advance applications, along with client credit files, we estimate the effect of cash advance use on customers in the margin of firm financing choices.

We discover that cash advance usage causes customers to try to get extra bank card and individual loan credit within half a year after loan acceptance that is payday. This leads to successful loan candidates taking right out more non-payday loans and total credit that is non-payday, especially for unsecured loans. Continue reading