FinTech Lending

Author:

Berg Tobias1,Fuster Andreas234,Puri Manju56

Affiliation:

1. Frankfurt School of Finance and Management, Frankfurt, Germany

2. Ecole Polytechnique Fédérale de Lausanne, Lausanne, Switzerland

3. Swiss Finance Institute, Zurich, Switzerland

4. Centre for Economic Policy Research, London, United Kingdom

5. The Fuqua School of Business, Duke University, Durham, North Carolina, USA;

6. National Bureau of Economic Research, Cambridge, Massachusetts, USA

Abstract

In this article, we review the growing literature on financial technology (FinTech) lending—the provision of credit facilitated by technology that improves the customer–lender interaction or used in lenders’ screening and monitoring of borrowers. FinTech lending has grown rapidly, though in developed economies like the United States it still accounts for only a small share of total credit. An increase in convenience and speed appears to have been more central to FinTech lending's growth than improved screening or monitoring, though there is certainly potential for the latter, as is the case for increased financial inclusion. The COVID-19 pandemic has shown potential vulnerabilities of FinTech lenders, although in certain segments they have displayed rapid growth.

Publisher

Annual Reviews

Subject

Economics and Econometrics,Finance

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