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Home | Events Archive | The Real Effects of FinTech Lending on SMEs: Evidence from Loan Applications
Seminar

The Real Effects of FinTech Lending on SMEs: Evidence from Loan Applications


  • Location
    Tinbergen Institute, room 1.01
    Amsterdam
  • Date and time

    May 10, 2023
    12:45 - 14:00

Abstract
We examine the effects of FinTech lending on firm policies using proprietary data on loan applications and loans granted from a peer-to-business platform. We find that FinTech serves high quality and creditworthy small businesses who already have access to bank credit. Firms access FinTech to obtain long-term unsecured loans and reduce their exposure to banks with less liquid assets, stable funds, and capital. We find that firms with access to FinTech loans significantly increase investment, employment, and sales growth relative to firms that get their loan application rejected. We identify these effects by exploiting the number of banks in each municipality as a source of exogenous variation in the probability of obtaining a FinTech loan. Our findings suggest that FinTech allows firms to improve their financial flexibility and reduce bank dependence. Joint paper with Afonso Eca, Miguel A. Ferreira and Antonino Emanuele Rizzo.

Link to paper. You can chedule an individual meeting with the speaker via this link on a on a first come first served basis.