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Impact Investing Through Crowdlending: Examining the Role of Intermediation and the Potential for Development Banks

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  3. Vierteljahrshefte zur Wirtschaftsforschung
  4. Vol. 89, Issue 3
  5. pp. 99–118

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Lee, A., Weiland, C. Impact Investing Through Crowdlending: Examining the Role of Intermediation and the Potential for Development Banks. Vierteljahrshefte zur Wirtschaftsforschung, 89(3), 99-118. https://doi.org/10.3790/vjh.89.3.99
Lee, Andrew and Weiland, Christiane "Impact Investing Through Crowdlending: Examining the Role of Intermediation and the Potential for Development Banks" Vierteljahrshefte zur Wirtschaftsforschung 89.3, , 99-118. https://doi.org/10.3790/vjh.89.3.99
Lee, Andrew/Weiland, Christiane: Impact Investing Through Crowdlending: Examining the Role of Intermediation and the Potential for Development Banks, in: Vierteljahrshefte zur Wirtschaftsforschung, vol. 89, iss. 3, 99-118, [online] https://doi.org/10.3790/vjh.89.3.99
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Impact Investing Through Crowdlending: Examining the Role of Intermediation and the Potential for Development Banks

Lee, Andrew | Weiland, Christiane

Vierteljahrshefte zur Wirtschaftsforschung, Vol. 89 (2020), Iss. 3 : pp. 99–118

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Article Details

Publisher Name
Duncker & Humblot
DOI
https://doi.org/10.3790/vjh.89.3.99
Language
English
Pages
20
Keywords

Author Details

Andrew Lee, DHBW Karlsruhe

  • Andrew Lee is a professor of economics at the Baden-Wuerttemberg Cooperative State University in Karlsruhe. He completed his doctorate in economics at the University of Basel in 2001 and worked for UBS AG until 2005. He then returned to the University of Basel, where he undertook two research projects concerning the impact of Fair Trade, until accepting the current post he now holds in Karlsruhe in 2009. His research interests are in international trade in general and in Fair Trade in particular.
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Christiane Weiland, DHBW Karlsruhe

  • Christiane Weiland is head of the degree programme in banking at the Baden-Wuerttemberg Cooperative State University in Karlsruhe. She is also a member of the Supervisory Board and Chairwoman of the Audit Committee of the Deutsche Investitions- und Entwicklungsgesellschaft DEG. She graduated in business administration at the University of Applied Sciences of the Deutsche Bundesbank and in economics at the Goethe University in Frankfurt am Main. She holds a PhD from the University of Heidelberg. Her professional stations at Deutsche Bundesbank and PwC deepened her expertise in finance. Christiane Weiland’s current areas of research focus on regulation, digital transformation in finance and development finance.
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Abstract

Summary: Development banks are facing changing market conditions with low interest rates, rapid technological change, and an increased interest in impact investment. This combination of factors challenges traditional processes and business models, but also provides a chance to develop new and sustained business opportunities. We examine examples of impact investment crowdfunding platforms in an international and domestic context. We evaluate their organisational structure, especially in connection with the potential integration of an intermediary and possible conflicts of interest. Our analysis provides both economic justification for activities of promotional and development banks in this area and new inputs for expanding their business model with a transparent and trustworthy financial lending instrument for small-scale retail investors.

Table of Contents

Section Title Page Action Price
Andrew Lee and Christiane Weiland: 99
 Impact Investing Through Crowdlending: Examining the Role of Intermediation and the Potential for Development Banks 99
1 Introduction 100
2 Environment and dynamics for promotional banks and development finance institutions 101
2.1 Broad range of approaches in development finance and promotion 101
2.2 Digitalisation creates opportunities for new business models and processes 102
2.3 Implications of low interest rate environment and shift in societal values 103
3 Impact investing through crowdlending platforms 105
3.1 Crowdlending platforms with an international focus: Kiva and Zidisha 105
3.2 Crowdlending with a domestic or regional focus: GLS Crowd and L-Bank MikroCrowd 106
4 Evaluation of the different organisational structures of the platforms 99
4.1 Granularity on borrower and lender side 99
4.2 Role of a potential intermediary and incentive effects 99
5 Development banks as an intermediary in impact investment structures 99
5.1 Providing expertise while minimizing conflicts of interest 99
5.2 Reducing uncertainty and providing impact investment opportunities for small private investors 99
5.3 Use of new technologies 99
6 Summary 99
References 99

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