Are women more risk-averse then men when it comes to lending money to strangers via p2p lending services? A recent study by Nataliya Barasinska, analyzed what impact gender has on the investment decisions. In the study, which was supported by a grant by the European Commission, she looked at bidding and loan data of the German p2p lending service Smava for the time span from March 2007 to March 2010.
Women are a minority among lenders, but are no more risk-averse than men
Only about 10% of the lenders at Smava are women. But they do not perceive and react to risks differently than men, when it comes to picking loans for investments.The study finds:
Because payoffs are uncertain, p2p loans can be seen as a form of risky investment. Not surprisingly, the extent of participation of females in this market resembles the pattern observed
in the other markets for risky financial assets: Female investors with 10% are a minority among investors.
However, when comparing the investment choices of male and female investors no significant differences are found with respect to risk propensity. [The study tests] test whether female investors respond to increasing variance in expected returns differently than male investors. The test results show that gender does not matter for risk preferences. A marginal increase in the standard deviation of expected return equally affects the probability of investment by males and females. Hence, the data on peer-to-peer lending do not support the common belief that women generally tend to take less risks in investments than their male counterparts.