Title

Online Peer-to-Peer Lending Decision Making: Model Development and Testing

Document Type

Article

Publication Date

2016

Department

Finance, Real Estate, and Business Law

Abstract

We explored lenders' decision-making processes in online peer-to-peer (P2P) lending by drawing on trust theory and the valence framework to develop an integrated decision-making model, which we then tested empirically using data from a survey conducted with 474 online lenders in China. The results showed that initial trust and perceived benefit determined willingness to lend, and that the fear of borrower opportunism did not have a significant impact on this willingness. Initial trust increased willingness to lend both directly and indirectly, increased it by increasing perceived benefit. We have identified the specific features of online P2P lending and provided valuable insights for borrowers, lenders, and intermediaries.

Publication Title

Social Behavior and Personality

Volume

44

Issue

1

First Page

117

Last Page

130

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