FinTech Lending and Cashless Payments

Pulak Ghosh, Boris Vallee and Yao Zeng

No 34148, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Borrowers’ use of cashless payments improves their access to capital from FinTech lenders and predicts a lower probability of default. These relationships are stronger for cashless technologies providing more precise information, and for outflows. Cashless payment usage complements other signals of borrower quality. We rationalize these empirical findings using a framework in which borrowers signal their lower likelihood of diverting cash flows through payment technology choice, and screening accuracy is further strengthened by informational complementarities. The informational synergy we uncover provides a rationale for the joint rise of cashless payments and FinTech lending, as well as for open banking.

JEL-codes: E42 G21 G23 (search for similar items in EconPapers)
Date: 2025-08
New Economics Papers: this item is included in nep-cfn, nep-fdg and nep-pay
Note: AP CF ME
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