Determinants of Peer-to-Peer Lending Expansion: The Roles of Financial Development and Financial Literacy
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This study investigates how peer-to-peer (P2P) lending—also known as crowdlending or debt-based crowdfunding—can be expanded to fill funding gaps in economies and promote financial inclusion.
Using a sample of 62 economies over the period 2015–2017, the study examined factors that impact P2P lending. It found that financial institutions’ efficiency, financial literacy, and lower branch and ATM penetration are positively related with the expansion of P2P lending. Physical infrastructure, such as better information technology infrastructure, was also identified as an important factor.