Encouraging recalibration of student loans in the Netherlands: the impact of information about future costs and the ease of adjustment

Rising student debt, overborrowing among Dutch students, and the complexity of students’ loan decisions signal the need for interventions that evoke more thoughtful loan decisions among Dutch students. In a large field experiment (N= 48,700) we addressed this need by testing interventions that encourage them to recalibrate their monthly loan amount. We compared a control condition to four interventions, in which we provided students with different kinds of personalised information about the future costs of their student loan and about how easily the height can be adjusted. Although all interventions increased recalibration, the intervention that provided students with the most elaborate personalised information about the future costs of their student loan yielded the most stable effects. These students were more likely to decrease their monthly loan amount (OR=1.28 [95% CI: 1.08, 1.52]), and when they did, they decreased it to a larger extent (B=−4.28 [95% CI: −7.99, −0.57]) than students in the control condition. Limitations and policy implications will be discussed.