Brokers in the Credit Market: An Examination of the Vertical Scope
Enzo Scannella *
Banking and Finance Visiting Scholar Harvard Business School, Boston, Massachusetts, USA and Department of Economics, Business and Statistics, University of Palermo, Palermo, Italy
*Author to whom correspondence should be addressed.
Abstract
This paper analyzes the vertical disintegration of the bank loan origination value chain. The main aim is to identify the relevant drivers which cause the emergence of brokers in the credit market which lead to vertical disintegration of the credit origination value chain. Transaction cost economics is the typical perspective of analysis of the vertical scope of banking value chains. This paper argues that in order to capture the drivers underlying the dynamic evolution of the vertical scope of bank loan origination business models, the above perspectives must be combined and further integrated with a capabilities and resource based view and with a modularity perspective.
Keywords: Loan broker, loan origination, lending, value chain, vertical scope, vertical disintegration