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Challenges in designing an inclusive Peer-to-peer (P2P) lending system

Conference Paper (2023)
Author(s)

R. Sulastri (TU Delft - Technology, Policy and Management)

M.F.W.H.A. Janssen (TU Delft - Technology, Policy and Management)

Research Group
Information and Communication Technology
DOI related publication
https://doi.org/10.1145/3598469.3598475 Final published version
More Info
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Publication Year
2023
Language
English
Research Group
Information and Communication Technology
Pages (from-to)
55–65
Publisher
ACM
ISBN (electronic)
9798400708374
Event
24th Annual International Conference on Digital Government Research - Together in the Unstable World: Digital Government and Solidarity, DGO 2023 (2023-07-11 - 2023-07-14), Gdansk, Poland
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Abstract

Literature suggests advantages of Peer-to-peer (P2P) lending systems over conventional banking credit, such as better credit scoring, and direct interaction of lenders-borrowers. Fintech P2P lending companies can process scattered individual information using advanced statistical methods and serve unreached market segments improving inclusiveness in society. Establishing inclusive P2P lending systems remains challenging, however, there is no systematic overview of such design challenges. Failure in designing an inclusive system creates a system that remains exclusive for some parts of society which hinders them from increasing economic transactions or even continuing business as usual due to limited funds. This research aims to identify the challenges in designing P2P lending systems that block inclusiveness in society. We conducted a systematic literature review followed by semi-structured interviews with financial inclusions and P2P lending systems experts. Our review found a variety of challenges in designing inclusive P2P lending systems. We classify the challenges into six categories. The main challenges are related to trust in the systems, literacy, and data issues.