Do borrowers make homogeneous decisions in online P2P lending market? An empirical study of PPDai in China

Author

Li, Siming ; Qiu, Jiaxian ; Lin, Zhangxi ; Qiu, Junsheng

Author_Institution

Sch. of Econ. & Inf. Eng., Southwestern Univ. of Finance & Econ., Chengdu, China

fYear

2011

fDate

25-27 June 2011

Firstpage

1

Lastpage

6

Abstract

In online P2P lending market, borrowers need to make strategic decisions, which will determine they will get the loans or not. In this study, we firstly investigate what and how the decisions made by borrowers influence the auction results. The empirical results display that borrower´ decisions, e.g., loan amount, interest rate will determine whether she could successfully fund loan or not, especially loan amount requested by borrowers. Then, it is focus on analyzing the difference of two borrower´s critical decisions (loan amount and interest rate) among successful, unsuccessful capable and incapable listings, and find out that borrowers of three types of listings make heterogeneous decisions. Finally, we provide some suggestions to online P2P lending market about borrowers´ decisions aid services based on the results, which could be a contribution with the practical implementation of borrower decision support system.

Keywords

Internet; credit transactions; decision making; decision support systems; economic indicators; electronic commerce; peer-to-peer computing; auction; borrower decision support system; decision-making; heterogeneous decision; homogeneous decision; interest rate; loan amount; online P2P lending market; peer-to-peer; strategic decision; Decision making; Economic indicators; Predictive models; Probability; USA Councils; borrower; decision-making; online P2P lending;

fLanguage

English

Publisher

ieee

Conference_Titel

Service Systems and Service Management (ICSSSM), 2011 8th International Conference on

Conference_Location

Tianjin

ISSN

2161-1890

Print_ISBN

978-1-61284-310-0

Type

conf

DOI

10.1109/ICSSSM.2011.5959504

Filename

5959504