This paper studies the role of trust in incumbent lenders (banks) as an entry barrier to emerging FinTech lenders in the credit markets. The empirical setting exploits the outburst of the Wells Fargo scandal as a negative shock to the trust in banks. Using a difference-in-differences framework,...

Using a nationwide restaurant sample, we document that minority-owned businesses are more likely to apply to the Paycheck Protection Program through fintech than traditional lenders. We motivate our analysis by a two-sided matching model where this phenomenon can be generated through "technology...