Abstract: In this paper, we illustrate a phenomenon in which the P2P platform displays almost 40% of all loans during the first minutes of each releasing hour and charges significantly higher fees than other loans after controlling for loan characteristics and various fixed effects. Furthermore, we employ two identification tests to establish causality: RDD style analysis around the first minute and policy change in 2013 as a shock. All these results yield a consistent argument that the platform intentionally put loans with more fees in the first minute to maximize its profit. Moreover, since the platform can only collect the fees through successfully funded loans, the results are more significant for loans with higher successful funded probability: small amount, short term, and high credit score loans. We further demonstrate that the platform intentionally selects loans into the first minute of an hour by presenting that first-minute loans have higher pre-listing waiting times than others. Finally, we also look at the consequence of this deliberately loan listing action and find that borrowers with loans in the first minutes have less probability of requesting another loan with the platform.
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