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Review of Economics

Jahrbuch für Wirtschaftswissenschaften

Editor-in-Chief: Berlemann, Michael

Ed. by Haucap, Justus / Thum, Marcel

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Volume 69, Issue 1


Peer-to-Peer Lending – A (Financial Stability) Risk Perspective

Benjamin Käfer
Published Online: 2017-12-19 | DOI: https://doi.org/10.1515/roe-2017-0020


The aim of this survey article is to discuss P2P lending, a subcategory of crowdfunding, from a (financial stability) risk perspective. The discussion focuses on a number of dimensions such as the role of soft information, herding, platform default risk, liquidity risk, and the institutionalization of P2P markets. Overall, we conclude that P2P lending is more risky than traditional banking. However, it is important to recognize that a constant conclusion would be misleading. P2P platforms have evolved and changed their appearance markedly over time, which implies that although our final conclusion of increased riskiness through P2P markets remains valid over time, it is based on different arguments at different points in time.

Keyword: Peer-to-peer lending; crowdfunding; financial development; financial stability risk


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About the article

Published Online: 2017-12-19

Published in Print: 2018-03-26

Citation Information: Review of Economics, Volume 69, Issue 1, Pages 1–25, ISSN (Online) 2366-035X, ISSN (Print) 0948-5139, DOI: https://doi.org/10.1515/roe-2017-0020.

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