Abstract:

Recent technological advancements have led to the establishment of online peer-to-peer lending concept, which allows lending for small and medium enterprises in the internet without the inclusion of financial institutions such as banks. However, since this is a new financing method, trust needs to be cultivated to influence lenders to lend. This research aims to analyze the effect of trust in borrower, trust in intermediary and perceived benefit on the intention to lend to small and medium enterprises in Indonesia in peer-to-peer lending. The results of this study indicate that willingness to lend in peer-to-peer lending platform is significantly influenced by the perceived benefit of the transaction, while trust in both borrower and trust in the peer-to-peer lending intermediary do not play an imperative factor to affect lender’s willingness to lend.