| With Internet into China, Internet finance have achieved rapid development in recent years. Under this background, the P2P network lending patterns come up in China quietly and develop rapidly. P2P network lending takes advantage of the internet technology to break the barrier of the traditional financial institutions.P2P online lending changes the patterns of financial competition to avoid financial intermediaries. P2P network lending is a new development pattern of financial innovation and a bridge between two sides of debtor and creditor. Based on the advantages of Internet and finance, debtor and creditor can trade directly which lowers the borrowing costs. Therefore, more and more small and medium-sized enterprises and poor people can enjoy more efficient and convenient financial services. Specifically, people submit personal information to register as a member in the P2P network lending platform. P2P platform rate the registered members, then the borrower submit the loan application in P2P platform. After the approval of the P2P platform, the loan application information can be listed on the platform loan which potential investors can see and decide which project and how much the money to invest P2P platform inspect and investigate the credit level, economic effectiveness and management level of borrower as a intermediary. The P2P platform charges the fees for revenue. P2P network lending platform generally adopt unsecured credit loans. Of course, there are mortgage. They provide a small amount of the loan mainly for students, working-class and small and micro business owners who with good credit but lack of funds. If the creditors worry about debtor, they can increase the security of company for the debt. P2P make the borrower who is hard to enjoy the service of traditional banking enjoy efficient and convenient loans through the Internet. Also it has a low threshold and cost.Firstly we introduce the current situation of the P2P network lending platform of China. Then we introduce the development of rate of interest of domestic P2P network lending and analyze the different platform and the regional difference. After that, the third part of this essay elucidate the economic theory like the Asymmetric Information, Financial repression theory, Financial exclusion theory and the theory of the Interest Rate Decision theory so as to analyze the problem and inevitability of develop P2P network lending. Based on the data of P2P network lending platform, this essay selected 11 explanatory variables. They are the amount of borrowing, the term of borrowing, the credit of debtor, the income range, the education background, the marriage, housing situation, the mortgage situation, the car loan situation, the amount of successful loan and unsuccessful loan. Then we test these variables how to influence the interest rate of the P2P network lending. The empirical results show that there are four explanatory variables that correlated with explained variable significantly. In addition, there is no significant correlation between the interest rate and other seven explanatory variables. The empirical results shows that the higher the credit rating, the lower the interest rates. The credit rating will affect the investor significantly. Besides, the shorter the borrowing time, the lower the interest rate. The empirical results also reveal that the married borrower will get lower interest rate. In order to promote the orderly development of the interest rate of P2P network lending. Finally, we put forward specific proposals from three aspects. At the end of this essay we predict the development tendency of the rate of P2P networks lending. |
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