Who Can Get Money? Evidence from the Chinese Peer-To-Peer Lending Platform

Abstract

This paper explores how borrowers’ financial and personal information, loan characteristics and lending models affect peer-to-peer loan funding outcomes. Using a large sample of listings from one of the largest Chinese online P2P lending platforms, we find that those borrowers earning a higher income or owning a car are more likely to receive a loan, pay lower interest rates and are less likely to default. The credit grade assigned by the lending platform may not represent the creditworthiness of potential borrowers. we also find that the offline process in the P2P online lending platform exerts significant influence on the lending decision.