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Filene Releases Final Report for Its LIFT Pilot
Thursday, August 7, 2014 6:35 AM

The Filene Research Institute has released the final report for its LIFT pilot. LIFT stands for lower interest for timeliness, and thanks to a generous grant from the Center for Financial Services Innovation, Filene was able to build and test LIFT with five credit unions and more than 1,000 low-moderate- income consumers with subprime credit scores.

LIFT was applied to automobile loans since credit unions generate high volumes of these types of loans. As part of the market test, the LIFT feature rewarded consumers who made three consecutive on-time payments with a 25-basis-point loan pricing reduction. Within the report, a team of researchers from the University of Wisconsin-Madison present detailed insights and results from this market pilot. 

The researchers conclude that the LIFT pilot proves borrowers do respond to positive incentives for on-time payments. The report also highlights the impact LIFT had on late fees, late-payments, and defaults.

The report is available on Filene’s website; however, you must be a member to read the full report. Click here to access the report.