Liquidity risk in FinTech lending: Early impact of the COVID-19 pandemic on the P2P lending market

IF 5.6 2区 经济学 Q1 BUSINESS, FINANCE
Asror Nigmonov , Syed Shams , Khorshed Alam
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Abstract

This study empirically investigates the impact of the COVID-19 pandemic on the liquidity risk incurred by the peer-to-peer (P2P) lending market. As the pandemic adversely affects financial markets globally, a better understanding of the dynamics of successful P2P lending is necessary under the conditions of financial distress. By using the cross-country database of secondary market listing outcomes at Bondora (Estonia) and employing probit, ordered probit and tobit regression methods, we provide evidence of the pandemic-induced exposure to liquidity risk in the P2P lending market. Despite increased volatility in the financial markets, results show that COVID-19 risk increases the probability of successful listing during the pandemic. However, this outcome comes at significant liquidation costs for investors in the form of higher premiums. Further analysis based on listing outcomes and loan characteristics shows a negative association between COVID-19 risk and share of overdue loans and average overdue days in secondary market listings. Simultaneously, more experienced investors dominate the market as COVID-19 risk increases, a trend that is reflected in shorter listing times. The findings of this study imply certain early tendencies in financial markets during pandemic-induced turmoil and open new avenues for further research.

金融科技借贷中的流动性风险:新冠疫情对P2P借贷市场的早期影响
本研究实证考察了新冠肺炎疫情对P2P借贷市场流动性风险的影响。由于大流行对全球金融市场产生不利影响,在金融困境的情况下,有必要更好地了解成功的P2P借贷的动态。通过使用Bondora(爱沙尼亚)二级市场上市结果的跨国数据库,并采用probit、有序probit和tobit回归方法,我们提供了大流行引发的P2P借贷市场流动性风险暴露的证据。尽管金融市场波动加剧,但结果显示,COVID-19风险增加了大流行期间成功上市的可能性。然而,这一结果以更高的溢价形式为投资者带来了巨大的清算成本。基于上市结果和贷款特征的进一步分析显示,COVID-19风险与二级市场上市的逾期贷款比例和平均逾期天数呈负相关。与此同时,随着COVID-19风险的增加,更有经验的投资者主导了市场,这一趋势反映在上市时间的缩短上。这项研究的结果暗示了金融市场在大流行引发的动荡期间的某些早期趋势,并为进一步研究开辟了新的途径。
本文章由计算机程序翻译,如有差异,请以英文原文为准。
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来源期刊
CiteScore
7.10
自引率
4.20%
发文量
85
审稿时长
100 days
期刊介绍: The intent of the editors is to consolidate Emerging Markets Review as the premier vehicle for publishing high impact empirical and theoretical studies in emerging markets finance. Preference will be given to comparative studies that take global and regional perspectives, detailed single country studies that address critical policy issues and have significant global and regional implications, and papers that address the interactions of national and international financial architecture. We especially welcome papers that take institutional as well as financial perspectives.
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