How voluntary information sharing systems form: Evidence from a U.S. commercial credit bureau

José Liberti, Jason Sturgess, Andrew Sutherland*

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

Abstract

We use the introduction of a U.S. commercial credit bureau to study when lenders adopt voluntary information sharing technology and the resulting consequences for competition and credit access. Our results suggest that lenders trade off access to new markets against heightened competition for their own borrowers. Lenders that initially do not adopt lose borrowers to competitors that do, which ultimately compels them to adopt and leads to the formation of an information sharing system. Access to credit improves but only for high-quality borrowers in markets with greater lender adoption. We provide the first direct evidence on when financial intermediaries adopt information sharing technologies and how sharing systems form and evolve.

Original languageEnglish (US)
JournalJournal of Financial Economics
DOIs
StateAccepted/In press - 2021
Externally publishedYes

Keywords

  • Access to credit
  • Financial intermediation
  • Fintech
  • Information sharing
  • SMEs

ASJC Scopus subject areas

  • Accounting
  • Finance
  • Economics and Econometrics
  • Strategy and Management

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