Prize-Linked Savings: Creating Financial Confidence and Opportunity

Prize-Linked Savings: Creating Financial Confidence and Opportunity

Prize-linked savings (PLS) products are improving financial confidence and self-efficacy. Previous D2D research has provided evidence on the impact of prized-linked solutions on helping financially vulnerable consumers try savings products and build reserves. New research shows that consumers are building financial confidence and improving their financial decision-making across products and improving their overall financial health. Users of PLS products attribute this change to their access and continued use of their prize-linked savings accounts.

Get this Publicaton
Please complete this form and you will immediately be given a link to download.

Key Takeaway

While many people know why they should save and have the desire to do so, getting started proves to be a problem. More engaging products can help to build the needed motivation.

Key Learnings

  • Suggesting an exact amount to save with a reason for doing so, rather than just suggesting that people save in general, may provide a better framework for behavior change.

  • By penalizing withdrawals, account holders are more likely to leave the money alone and allow it to grow over time.

  • While lack of money to save is one barrier, a lack of knowledge about savings products and how to save is another that requires consideration.

Key Findings

  • Most Save to Win account holders regularly deposit $25, the amount needed to gain an entry in the prize drawing.

  • Some account holders had never had a Certificate of Deposit, or even knew what they were, and many found it to be a perfect savings vehicle due to penalizing withdrawals.

Challenges

Related Challenge

Solutions

Related Solution

Projects

Related Projects