Emergence of Financial Intermediaries on Electronic Markets: The Case of Online P2P Lending
نویسندگان
چکیده
We analyze the role of intermediaries on electronic markets using detailed data of more than 14,000 originated loans on an electronic P2P (person-to-person) lending platform. On such an electronic credit market lenders bid for supplying a private loan. Screening of potential borrowers and the monitoring of loan repayment can be delegated to designated group leaders. We find that these participants act as financial intermediaries between borrowers and lenders and significantly improve borrowers’ credit conditions. Our findings are robust to self-selection and characteristics of the financial transactions, and may be surprising given the long discussion on disintermediation due to electronic marketplaces. JEL Classification: D82, G21, G24
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