Journal of Finance Vol. 79 No. 5 2024

FinTech Credit and Entrepreneurial Growth

Harald Hau¹; Yi Huang^2,3; Chen Lin^2,3; Hongzhe Shan^2,3; Zixia Sheng^2,3; LAI WEI

¹ University of Geneva · ² Swiss Finance Institute · ³ University of Hong Kong

Abstract

Based on automated credit lines to vendors trading on Alibaba's online retail platform and a discontinuity in the credit decision algorithm, we document that a vendor's access to FinTech credit boosts its sales growth, transaction growth, and the level of customer satisfaction gauged by product, service, and consignment ratings. These effects are more pronounced for vendors characterized by greater information asymmetry about their credit risk and less collateral, which reveals the information advantage of FinTech credit over traditional credit technology.

DOI

10.1111/jofi.13384

Volume

79

Issue

5

Pages

3309-3359

Language

en

Sources

bibtex:phds-export.bib openalex crossref

Cite

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