Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/261173 
Year of Publication: 
2022
Series/Report no.: 
ECB Working Paper No. 2639
Publisher: 
European Central Bank (ECB), Frankfurt a. M.
Abstract: 
We show that FinTech lending affects credit markets and real economic activity using a unique data set of a Peer-to-Business platform for which we have the universe of loan applications. We find that FinTech serves high quality and creditworthy small businesses who already have access to bank credit. Firms use FinTech to obtain long-term unsecured loans and reduce their exposure to banks with less liquid assets, stable funds, and capital. We find that access to FinTech spurs firm growth, employment and investment relative to firms that get their loan application rejected. In addition, firms with access to FinTech increase leverage and substitute long-term bank debt with FinTech debt. Our findings suggest that FinTech allows firms to preserve financial exibility, reduce their bank dependence and exposure to banking shocks.
Subjects: 
FinTech
Small business lending
Firm growth
Debt structure
Bank relationships
JEL: 
G21
G23
O33
Persistent Identifier of the first edition: 
ISBN: 
978-92-899-4972-9
Document Type: 
Working Paper

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