The Australian Competition and Consumer Commission (ACCC) currently has a Best Practice Guide for International Money Transfer (IMT) calculators. However, evidence suggests that online calculators may still be confusing for users.
This research will test a number of potential changes to IMT calculators. These changes are designed to improve the communication of fees and exchange rate margins with users. These changes should allow consumers to directly compare IMT services with each other, which will improve competition and ultimately improve value to consumers.
Findings from this research may inform updates to the ACCC Best Practice Guide.
ADDITIONAL TRIAL INFORMATION
Intervention start date:
15 May 2023
Ethics approval
Human Research Ethics Committee (HREC) Humanities and Social Sciences, Macquarie University. Reference: 15504
Experimental design:
This research will consist of two 8-arm randomised controlled trials embedded in a survey delivered online using the Qualtrics platform.
Interventions
This trial consists of seven treatment arms and a control group. Interventions fall into three overall categories (see below). From these categories, we derive five treatment arms, with two additional arms consisting of combinations of these interventions. More detail on the categories and individual arms are included below:
1. Fee methodology
Transfer fees are either consistently deducted from, or added to the amount the user wishes to send. These arms will be labelled ‘fee subtracted’ and ‘fee added’. Currently IMT providers use a mix of both methodologies.
2. Comparison rate prompt
The inclusion of a comparison rate at the bottom of the calculator, expressed as either a dollar amount or percentage e.g. “4.31% of the total you pay is taken by fees and the exchange rate margin.” These arms will be labelled ‘prompt dollar’ and ‘prompt per cent’.
3. FX margin disclosure
The inclusion of the difference between the applied exchange rate and the mid-market rate. This arm will be labelled ‘FX margin’.
4. Control group
Our control group provides no comparison rate prompt and no information about the FX margin. Within a scenario fees will be presented as both added and subtracted to the exchange amount. This represents the way IMT calculators currently vary across providers.
5. Combinations
We will test two combination interventions. The first includes both the prompt dollar and FX margin interventions and will be labelled ‘combination 2’. The second will include prompt dollar, fees subtracted and FX margin and will be labelled ‘combination 3’. These arms are labelled to reflect the number of atomic interventions embedded in each.
Outcome measures
Primary outcome
At an individual level, the primary outcome will be the proportion of correct responses given across the five scenarios. A correct response occurs when the participant selects the ‘best deal’ out of the four IMT calculators presented in a scenario. Thus, each individual’s outcome will be a binomial trial where n = 5.
The ‘best deal’ is defined by the calculator that represents the highest ratio of converted dollars to total cost. For example a calculator that delivers 6907.38USD at a cost of 10,000.00AUD has a ratio of 0.69074. This is better value than one that delivers 6925.00USD at a cost of 10,045.00AUD with a ratio of 0.6894.
Individual level outcomes will be averaged within treatment groups, to give the average proportion of correct responses by arm.
Secondary outcome
For our comparison experiment we will include a ‘don’t know’ response option for each calculator comparison question. When calculating our primary outcome, ‘don’t know’ responses will be treated as a wrong answer. However, we will assess ‘don’t know’ responses by treatment arm, presenting this data as a proportion.
We will measure confidence using a single survey item after the experiment. Participants will be asked to rate how confident they were that they could pick the calculator with the best value. It will be measured with a three-level single-sided response frame (not at all confident; somewhat confident; very confident). We will examine the distribution of individuals answering each of the three categories across treatment arms.
Our secondary judgement experiment will have two outcomes based on two separate survey items. The first will measure the proportion of individuals that are likely to seek more information, and the second the proportion that identify the presented bad deal calculator as such. These proportions will be compared across treatment arms.
Expected sample size
5600 (700 per arm)
Other
AEA pre-registration: TBA