P2P Financing Research Status, Economic Analysis And Development Prospects

P2P financing mode originally means " Peer-to-Peer lending", i.e., point to pointcredit, or person to person credit. The model originated in the United Kingdom in theeighty’s of last century and developed rapidly in the United States and other mainEuropean countries at the beginning of the century, and spread to China in2005, whichis the third party financial services emerging in China in recent years.Under P2P financing mode, lenders and borrowers can talk directly, meetinglenders’ raising capital needs and investor’s investment needs at the same time. In thecoastal and other economic developed area, P2P financing mode alleviates the financingconstraint problem for many small and medium enterprises, and provides a newinvestment instrument for many investors with a higher yield relative to the bankaccount and less risk relative to other financial products.This essay describes the current situation of P2P financing mode, history, businessmodel and then makes economic analysis to the P2P. After the economic analysis,empirical research and case studies follows. At last, makes a development prospectsanalysis about P2P in China.The main points of this paper are as follows:(1) P2P financing mode is a kind of financial innovation which emerges as theconsequence that China’s existing financial system cannot meet the needs of individualsor small and micro businesses financing demand and household investment demand.(2) The emergence of P2P financing mode is essentially the market spontaneousfree trade results which has its validity and the government should not ban it in amandatory way.(3) Under the P2P financing mode, the intermediary companies performs functionsas financial intermediary, to some extent solve the adverse selection and moral hazardproblems which usually exists in financial transaction.(4) The prospects of P2P financing mode remain to be further exploration.The main innovations of this essay include:(1)This essay studies a new topic the academic hasn’t make a deep researching. (2)This essay applies economic theory to analyze whys P2P financing modeemerges supplely.(3) This essay applies uses data from BSF company first-hand survey data.