Unsecured Lending via Delegated Underwriting
Fuente:
arXiv
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| Autor principal: | |
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| Formato: | Preprint |
| Publicado: |
2026
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| _version_ | 1866915979277107200 |
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| author | Estevez, Diego |
| author_facet | Estevez, Diego |
| contents | We develop a mechanism for unsecured lending among pseudonymous users that does not rely on collateral, legal identity, or centralized underwriting. New borrowers enter only through sponsors who delegate part of their own credit capacity, so onboarding a new account reallocates existing borrowing power rather than minting new capacity. Default losses flow back along the sponsor path, while repayment creates earned credit that expands future borrowing capacity. We prove that delegation conserves aggregate credit capacity, that revocation and default remain local to a unique sponsor path, and that a simple cap on earned-credit growth makes repay-then-default weakly unprofitable. |
| format | Preprint |
| id |
arxiv_https___arxiv_org_abs_2605_03307 |
| institution | arXiv |
| publishDate | 2026 |
| record_format | arxiv |
| spellingShingle | Unsecured Lending via Delegated Underwriting Estevez, Diego Computer Science and Game Theory Theoretical Economics J.4; K.4.4 We develop a mechanism for unsecured lending among pseudonymous users that does not rely on collateral, legal identity, or centralized underwriting. New borrowers enter only through sponsors who delegate part of their own credit capacity, so onboarding a new account reallocates existing borrowing power rather than minting new capacity. Default losses flow back along the sponsor path, while repayment creates earned credit that expands future borrowing capacity. We prove that delegation conserves aggregate credit capacity, that revocation and default remain local to a unique sponsor path, and that a simple cap on earned-credit growth makes repay-then-default weakly unprofitable. |
| title | Unsecured Lending via Delegated Underwriting |
| topic | Computer Science and Game Theory Theoretical Economics J.4; K.4.4 |
| url | https://arxiv.org/abs/2605.03307 |