Author:
HAU HARALD,HUANG YI,LIN CHEN,SHAN HONGZHE,SHENG ZIXIA,WEI LAI
Abstract
ABSTRACTBased 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.