Is an Offline Sharing Economy Innovation Transmissible Online?: Exploring the Role of Conformity in Group Lending

Is an Offline Sharing Economy Innovation Transmissible Online?: Exploring the Role of Conformity in Group Lending

Djamchid Assadi, Arvind Ashta, Nathalie Duran
Copyright: © 2021 |Pages: 29
DOI: 10.4018/978-1-7998-3226-3.ch006
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Abstract

Group lending is a social innovation because the substitution of the guarantee on assets by the collective guarantee of the group of belonging leads to the financial inclusion of the excluded. In a lending group, members who know each other mutually control each other to guarantee repayment of the loan and its circulation among the members. Is the social collateral that supported the development of the offline microcredit to the world level transposable to social lending on the internet? To answer this question, this chapter aims at determining the factors of mutual supervision and control of the members within the affiliation group and examine the potential of their transposition on the internet. Understanding the conditions for transposing social security is not only a solution to the problem of the unbanked; it is also a source of inspiration for peer-to-peer activities which develop considerably on the internet.
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Review Of Literature

In line with the essence of our research inquiry, we review three sets of literature relative to different aspects of our research inquiry. First, we study the founding concept of conformity in groups which institutes trustworthy behaviors of members and consequently social collateral. Second, we present group lending and substitution of assets-based collateral by social collateral. Three, we explore cyber-communities as online extension of conventional communities along with the P2P social lending platforms. Four, we define the concept of social innovation in line with the research inquiry which addresses the transmissibility of social collateral as an innovation from off to online communities. Five, we suggest a conceptual framework of individual conformity according the preceding literature reviews.

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