Analyzing Users of Loan Comparison Platforms in South Korea

Abstract

In South Korea, the market for online personal loan comparison services are booming. Using customer data from a lender firm in Korea, we analyze how borrowers from different affiliate marketing channels including four major online personal loan comparison service platforms differ in terms of customer characteristics and their likelihood of default. Customers who takes out personal loans through online personal loan comparison service platforms are, on average, younger, more likely to purchase personal loan products rather than business loans, less likely to be in high credit rating level, and transact with a larger number lenders. Using multivariate analysis, we show that the likelihood of loan default varies by affiliate marketing channels. Our result calls for customized customer risk management programs by affiliate personal loan marketing channels to increase profitability of lender firms.