| dc.description.abstract | Crowdfunding has experienced enormous growth in recent years, and the form of
crowdfunding that has grown most is crowdlending. A key reason for this growth is that
crowdlending has given small and medium enterprises easier access to capital. There are
currently no common regulations for crowdlending in Europe, and the regulations for
crowdlending in Norway and Sweden are different. However, the European Union has
recently passed a common regulation which will make regulations more equal between the
countries in the future.
This thesis investigates whether there are differences in credit quality among companies that
seek financing through crowdlending in Norway and Sweden. It also investigates if there are
differences in credit risk premiums cross-border. The results from these analyses could
provide insight into what will happen after the implementation of the common EU
regulations.
To analyze this, we construct a dataset containing information about companies that have
received funding through Norwegian and Swedish crowdlending platforms from 2017
through 2020. A range of OLS regression models are estimated to determine the relationship
between credit quality and country of issuance and between credit risk premium and country
of issuance. The empirical results demonstrate that the credit quality of companies receiving
funding through Swedish crowdlending platforms has been significantly higher than for their
Norwegian counterparts. They further show that credit risk premiums for loans issued
through Swedish crowdlending platforms have been significantly higher than for loans
issued through Norwegian platforms.
We argue that the main reason explaining the relatively poorer credit quality in Norway than
in Sweden is the current regulations. Specifically, we point to the peculiar Norwegian
investment limit of NOK 1 million per year. Further, we argue that the relatively lower credit
risk premiums in Norway constitutes an anomaly due to the same reason. | en_US |
