Information Sharing and User Behavior in Internet-enabled Peer-to-peer Lending Systems: An Empirical Study

Abstract

Type of publicationArticle ( have captured the attention of the Information Systems research community, and studies of user behavior in IP2PLS have revealed the saliency of social identity, personal transparency, and information sharing in such systems. We argue that the current state of knowledge is limited by methodological bias towards the study of particular IP2PLS providers, and report the findings of a study of a very large but under-researched platform. Through an analysis of 116,669 loan records, and a subsequent analysis of 1000 records manually coded through a content analysis process, we investigate the impact of information sharing on user behavior in an IP2PLS, revealing relationships that frequently contradict the findings from prior research. The paper discusses the contributions of our work towards a more complete and heterogeneous picture of user behavior in IP2PLS, implications for researchers of other crowdfunding systems and/or other emerging forms of IS-enabled collective action, as well as for system designers, users and providers.

The pastoral crowd: Exploring self‐hosted crowdfunding using activity theory and social capital

“…Social norms refer to the principles and values of the collective, which may or may not be manifested in the explicit and implicit rules of the activity system. This has been illustrated in research on loan-based crowdfunding, whereby different types of information disclosures have contrasting effects on different platforms with ostensibly similar rules (Feller, Gleasure, & Treacy, 2017). This is because the social norms of backers on those platforms differ at the level of principles and values, rather than at a feature or practice level.…”

Inclusive Technologies, Selective Traditions: A Socio-material Case Study of Crowdfunded Book Publishing

“…This effect is also visible across platforms, e.g. there is evidence from peer-to-peer lending that the types of voluntary disclosures made in unstructured loan descriptions vary on competing websites, as does their impact on lending behaviours (Feller et al, 2016). This contrasting enactment of material features into different crowdfunding practices is further illustrated by research on information hiding by Burtch et al (2013).…”

Crowdfunding and Social Capital: A Systematic Literature Review

“…In contrast to strong ties, which are mainly built through offline communications, both weak ties and latent ties are mainly developed online on crowdfunding platforms and through other social media (Borst et al 2018). Therefore, we propose that weak ties and latent ties mainly affect crowdfunding performance through communication (e.g., the comments posted online and the updates of projects), commitment (Zhao et al 2017) and group identity (Kromidha and Robson, 2016;Feller et al 2017). However, investors who were backed by the entrepreneurs before are the exception, as they are motivated by obligation and reciprocity because they feel it is their duty to fund other entrepreneurs in the early stage of crowdfunding campaigns (Zheng et al 2014;Colombo et al 2015;Butticè et al 2017).…”

“…First, the social networks associated with the identity of borrowers within the networks affect the probability that borrowers repay the investment and the lender's decision-making. Second, offline external social identity can be used to judge borrowers' reliability online (Feller et al 2017). Chen et al 2017 Social identity theory is also applied in reward-based crowdfunding.…”

“…These investors are mainly driven by financial returns, and therefore need to assess the quality of the projects, which requires due diligence, making the funding accumulate slowly. The commitments made by fundraisers and communications in the community can reduce the perceived risks and encourage funders to support the projects (Feller et al 2017;Zhao et al 2017). Moreover, previous research suggested that such knowledge sharing in the virtual community via communication affects the community outcomes (Chiu et al 2006) (i.e., crowdfunding success in a campaign).…”