We show that lenders join a U.S. commercial credit bureau when information asymmetries between incumbents and entrants … create an adverse selection problem that hinders market entry. Lenders also delay joining when information asymmetries … competition. We exploit shocks to information coverage to show that lenders enter new markets after joining the bureau in a …

relatively smaller information advantage face higher collateral requirements, and that technological innovations that narrow the … information advantage of local lenders, such as small business credit scoring, lead to a greater use of collateral in lending …We consider an imperfectly competitive loan market in which a local relationship lender has an information advantage …

We offer a new test of the ex ante theory of collateral. Theory states that lenders rely less on collateral if they … have better information about borrowers. We test this by contrasting the use of collateral between formal and – better … than informal lenders, controlling for conventional determinants of collateral. Moreover, having better information about …

The number of firm bankruptcies is surprisingly low in economies with poor institutions. We study a model of bank …-firm relationship and show that the bank's decision to liquidate bad firms has two opposing effects. First, the bank gets a payoff if a …

We study specialized lending in a credit market competition model with private information. Two banks, equipped with … similar data processing systems, possess "general" signals regarding the borrower's quality. However, the specialized bank … based on its specialized signal conditional on making a loan. This private-information-based pricing helps deliver the …

, we show that fintech loans to entrepreneurs are more likely to be unsecured and short-term while bank loans are expected … to be asset-backed and long-term. The findings suggest that fintech lenders substitute data for collateral to leverage … their own advantage stemming from lower collateral underwriting costs. The results offer a supply-side explanation for the …

borrower collateral versus third-party guarantees. Among first-time borrowers, the introduction of mandatory information … sharing leads to a shift from collateral to guarantees, in particular for riskier borrowers. Among repeat borrowers, both … collateral and guarantee requirements decline in proportion to the length of the lending relationship. These results suggest that …

inclined to pledge outside collateral than is the low-risk borrower. However, this finding does not hold when the bank can …Within a framework of debt renegotiation and a priori private information, what is the role of outside and inside … collateral? The literature shows that unobservability of the project’s returns implies that the high-risk borrower is more …

We studied information and interaction processes in six lending relationships between a universal bank and medium sized …, bank monitoring is based mainly on cheap, retrospective and internal data. In case of distress, more expensive, prospective … and external information is used. The level of monitoring and the willingness to renegotiate the lending relationship …

resulting from the information asymmetry. Furthermore, we extend the set of possible collateral to property rights over physical … and non physical assets, and explain how a superior lender's information can work as collateral. …Credit rationing and the use of collateral are widely observed in debt financing. To our view there is yet no …