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A process model on P2P lending

Author

Listed:
  • Huaiqing Wang

    (South University of Science and Technology)

  • Kun Chen

    (South University of Science and Technology)

  • Wei Zhu

    (South University of Science and Technology)

  • Zhenxia Song

    (South University of Science and Technology)

Abstract

Background Online peer-to-peer lending (P2P lending) is booming as the popularity of e-finance. To develop a conceptual model for the P2P lending process is great valuable for managers to tack the issues of marketing, management and operation. Methods In this paper, we focus on the P2P lending process model and provide a comparative analysis comparing with traditional bank loan process. Results Firstly, our model shows that the information flow in P2P lending is more frequent and transparent. Secondly, the model reveals that P2P lending uses a quite different credit audition method, which relies on information and the decision model in the P2P systems. Thirdly, the loan management is not complete normally in P2P lending, because most P2P companies do not have the post-loan records of borrowers. Conclusions These findings inspire future studies and practices on P2P lending process and key technologies.

Suggested Citation

  • Huaiqing Wang & Kun Chen & Wei Zhu & Zhenxia Song, 2015. "A process model on P2P lending," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 1(1), pages 1-8, December.
    • Handle: RePEc:spr:fininn:v:1:y:2015:i:1:d:10.1186_s40854-015-0002-9
    DOI: 10.1186/s40854-015-0002-9
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    References listed on IDEAS

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    1. Ty Kiisel, 2013. "Getting a Business Loan," Springer Books, Springer, number 978-1-4302-4999-3, March.
    2. Tengwen Zhang & Mingfeng Tang & Yong Lu & Dayong Dong, 2014. "Trust Building in Online Peer-to-Peer Lending," Journal of Global Information Technology Management, Taylor & Francis Journals, vol. 17(4), pages 250-266, October.
    3. Mingfeng Lin & Nagpurnanand R. Prabhala & Siva Viswanathan, 2013. "Judging Borrowers by the Company They Keep: Friendship Networks and Information Asymmetry in Online Peer-to-Peer Lending," Management Science, INFORMS, vol. 59(1), pages 17-35, August.
    4. Jefferson Duarte & Stephan Siegel & Lance Young, 2012. "Trust and Credit: The Role of Appearance in Peer-to-peer Lending," The Review of Financial Studies, Society for Financial Studies, vol. 25(8), pages 2455-2484.
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    Cited by:

    1. Xiaojiao Yu, 2017. "Machine learning application in online lending risk prediction," Papers 1707.04831, arXiv.org.
    2. Çağlar Hamarat & Daniel Broby, 2022. "Regulatory constraint and small business lending: do innovative peer-to-peer lenders have an advantage?," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 8(1), pages 1-25, December.
    3. Lin, Saiyan & Chen, Rongda & Lv, Zhihong & Zhou, Tianqing & Jin, Chenglu, 2019. "Integrated measurement of liquidity risk and market risk of company bonds based on the optimal Copula model," The North American Journal of Economics and Finance, Elsevier, vol. 50(C).
    4. Tzu-Chun Sheng & Ju-Lan Tsai & Hsuan-Ta Hsu, 2025. "Business Ethics Risks and Governmental Regulatory Mechanisms of Taiwan's P2P Lending Platforms," Journal of Applied Finance & Banking, SCIENPRESS Ltd, vol. 15(1), pages 1-4.
    5. Abbasi, Kaleemullah & Alam, Ashraful & Du, Min (Anna) & Huynh, Toan Luu Duc, 2021. "FinTech, SME efficiency and national culture: Evidence from OECD countries," Technological Forecasting and Social Change, Elsevier, vol. 163(C).

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    Keywords

    P2P landing; E-finance; Process model;
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