How does P2P lending platform reputation affect lenders’ decision in China?

Shi, Xiaokun; Wu, Junjie; Hollingsworth, Jane

doi:10.1108/ijbm-11-2018-0309

Cited by 25 publications

(16 citation statements)

References 35 publications

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“…The third section of the questionnaire is to collect data on the awareness of the eleven P2P lending platforms. Questions related to the main characteristics of P2P lending given in Shi, Wu, and Hollingsworth (2019) are used to test the awareness of P2P lending platforms in Malaysia. After filtering and validating the collected data, answers from only 65 respondents are used for the analysis.…”

Section: Methodsmentioning

confidence: 99%

P2P Lending platforms in Malaysia: the awareness among young adults

Nguyen

Muthaiyah

Sy³

2021

F1000Res

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Background - Since 2016, the Securities Commission (SC) in Malaysia has given licenses to only eleven P2P lending platforms. Such lending platforms are expected to disrupt the lending services of traditional lenders in the coming years. However, being still in their infant stages, it is essential to know the extent to which such platforms are made known to potential investors out there. This study examines the extent to which young adults are aware of Malaysia's eleven P2P lending platforms. Methods - A sample of 65 undergraduate students majoring in finance and accounting was used for this pilot study. An online questionnaire was designed with three main parts: demographic, financial literacy, and P2P lending awareness. Results - Findings show that more than half of respondents in the sample are not aware of P2P lending platforms in Malaysia. Most of the respondents are financially literate to certain degrees. Those aware of their presence underestimated the potentially high level of their default rates and misunderstood that investor would be fully protected by such platforms when a loan default. Conclusions -The study's findings have shed light on the current awareness of P2P lending platforms among Malaysian young adults, potential investors of such platforms in the coming years.

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Section: Methodsmentioning

confidence: 99%

P2P Lending platforms in Malaysia: the awareness among young adults

Nguyen

Muthaiyah

Sy³

2021

F1000Res

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“…Due to the information asymmetry, if P2P platforms deliberately hide critical information (e.g. the true operational status of P2P platforms) or take risky behaviors to make profits at the cost of the lenders' investments (Shi et al , 2019), lenders will face more significant risks (Lee and Lee, 2012). However, although lenders are aware of the multifarious risks, they still decide to participate in the investment in P2P lending.…”

Section: Research Model and Hypothesesmentioning

confidence: 99%

Influence of trust and risk on peer-to-peer investment willingness: a bidirectional perspective

Zhai

Chen

Ming-xia

2021

INTR

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PurposeThe purpose of this paper is to investigate the influence of trust and perceived risk on investment willingness considering the bidirectional relationship between trust and perceived risk in peer-to-peer (P2P) lending.Design/methodology/approachData were collected from a leading Chinese P2P platform, PPDAI.com. In total, 328 valid responses were received and analyzed using structural equation modeling (SEM).FindingsThe results show that the influence of trust on investment willingness is significant, whereas that of perceived risk is insignificant. The results also indicate that platform reputation has a positive effect on trust, and the quality of alternatives is positively associated with perceived risk. In addition, the bidirectional perspective should be preferred to cope with the bidirectional relationship between trust and perceived risk in P2P lending.Originality/valueThis study extends existing research on the influence of trust and perceived risk on investment willingness from a bidirectional perspective, which has not been addressed in the P2P lending context. In addition, this research enriches the current literature about trust and perceived risk by providing more evidence that the relationship between trust and perceived risk is bidirectional and thus the bidirectional model should be preferred. For practice, the study suggests that managers can earn trust and reduce the perceived risk of lenders by continuously providing high-quality products, services and enhancing platform reputation, ultimately improving their investment willingness.

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“…Ding et al proved that there was an effective reputation mechanism in the P2P lending market by analyzing the transaction data of 78,000 borrowers in the P2P lending platform "renrendai.com" [17]. Shi et al found that the reputation of the P2P lending platforms played a direct or indirect role in investors' investment choices [18]. Davies and Giovannetti pointed out that reputation played an important role in the success of crowd-funding projects [19].…”

Section: Literature Reviewmentioning

confidence: 99%

“…First, most of the existing literature mainly focuses on the reputation of borrowers and investors in the IFP. ey pay more attention to the mechanism [14][15][16][17][18][19], influencing factors [20][21][22], and the measurement of reputation [23].…”

Section: Introductionmentioning

confidence: 99%

Evaluating Reputation of Internet Financial Platform: An Improved Fuzzy Evaluation Approach

You

Hao

Dagestani

et al. 2021

Discrete Dynamics in Nature and Society

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Recent frequent “thunderstorm incidents” of the internet financial platforms (IFPs) have caused the panic of investors. In order to measure and reduce the investment risk of IFPs, the focus of this study is to evaluate the reputation of IFPs regarding investment risk. First, the reputation evaluation indicator system of IFPs is constructed from two dimensions of direct and indirect reputations. Then, based on this system, an improved fuzzy evaluation approach (IFEA) integrating the method of fuzzy comprehensive evaluation (FCE), the analytic hierarchy process (AHP), and the factor analysis (FA) are proposed for evaluating the reputation of IFPs. Finally, a case study based on the data of 20 peer-to-peer (P2P) lending platforms from “Home of Online Loans” (HOL) in China is used to illustrate the IFEA. Results show that the IFEA can reduce uncertainty and randomness in the determination process of indicator weight and membership degree and therefore accurately obtain the reputation level of IFPs and help investors make better decisions. Meanwhile, the key factors in determining the reputation of IFPs are identified, thereby improving the reputation level of the IFPs.

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How does P2P lending platform reputation affect lenders’ decision in China?

Cited by 25 publications

References 35 publications

P2P Lending platforms in Malaysia: the awareness among young adults

P2P Lending platforms in Malaysia: the awareness among young adults

Influence of trust and risk on peer-to-peer investment willingness: a bidirectional perspective

Evaluating Reputation of Internet Financial Platform: An Improved Fuzzy Evaluation Approach

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