Research On The Role Of Reputation In The Recognition Of P2P Lending Platform For Investors

P2P network lending is an emerging model of Internet finance,which refers to the transactions of small and unsecured loans between individuals through network intermediary platform.The emergence of P2P lending patterns makes up for the blank of traditional bank credit system business,meets the growing market demand of micro-finance,promotes the inclusive financial development in China.The first platform of China's P2P lending market was founded in 2007,and the number of industry began to grow explosively by 2011.However,P2P platform is in a mess,and in the meantime,some high quality platform run smoothly and meet investors' financial requirement,the problem platform also appears frequently.According to the home of lending incomplete statistics,the number of normal operation platform was 2248 and the number of fraud platform reached 1741,accounting for 43.64%of the total in the whole platform by the end of December 2016.Due to the lack of platform information disclosure and supervision policies,P2P lending industry in China had been exposed to many problems,involving huge amount of money,causing widespread concern in society.For example,E-rent victims had a total of 900,000 people throughout the 31 provinces and cities.In the continuous improvement of the lending market,can investors use the reputation to identify the platform in order to avoid the loss caused by platform disappeared?This paper analyzed the direct?indirect influence and function of reputation information from the perspective of investor identification,and studied the incentive and restraint of reputation.On the basis of reviewing the literature,this paper constructed the reputation signal transmission model,analyzed the reputation signal recognition and put forward the research hypothesis.Then this paper used the method of Beta function to measure the reputation of 335 sample platforms.The empirical test was carried out by using the multiple linear regression method.Respectively test:(1)the direct impact of reputation on recognition platform;(2)reputation through fundamental information to identify the intermediary effect of the platform;(3)the incentive and restraint function of reputation.Results show that:(1)reputation has a significant positive impact on the platform turnover.If the platform has a better reputation,investors are more willing to choose to trade on it,resulting in the increase of the platform volume,and reputation in lending markets plays a role in alleviating the adverse selection of information asymmetry;(2)the mediation effect results show that reputation has intermediary conduction effect,but significant differences:reputation in platform yields?platform area?a third party escrow and Internet finance association have partial intermediary effect,and the registered capital?loan time limit and platform trading volume are not significant;(3)reputation has incentive constraint effects in P2P lending platform,the better reputation,the more people tend to invest,improves the operation ability of platform,and promotes the survival time of platform.Reputation has significantly impact on survival time through the platform type?to take the third party fund hosting?to join the Internet finance association and other fundamental information,thereby promoting the healthy and sustainable development of the P2P lending market.According to the above research,this paper puts forward the suggestion for promoting the healthy development of lending platform from the perspectives of platforms,investors and government regulators.The theoretical significance of this research is to further enrich the existing research paths,and empirically examine the applicability of reputation mechanism theory in the development of China's lending platform;practical significance lies in providing information for investors to choose investment platform protecting the legitimate rights and interests of investors,and providing theoretical basis for the supervision of regulators.