To Share or Not? Hybrid e-Commerce Platform's Provision and Sharing Strategies of Consumer Credit Service

As a new financial innovation, consumer credit services are increasingly embraced by e-commerce platforms. This paper presents a stylized model to determine when an e-commerce platform should launch credit services and whether to share them with third-party sellers. Our findings indicate that the platform benefits from launching credit services only when consumer preference outweighs the delinquency rate. Furthermore, service sharing can create a win-win scenario with moderate fees and high consumer preference. Contrary to common belief, sharing services with sellers can reduce consumer surplus, suggesting that widespread use of consumer credit services is not necessarily beneficial for consumers.