Mitigating a demand shock through Fintech: Tian Gao, University of Manchester

Event Date: 15 October 2025

Speaker: Tian Gao (AMBS, University of Manchester)

Venue: CW404B (SBS, Cathedral Wing)

Time: 2pm

Abstract:

This paper examines how FinTech helps firms mitigate adverse effects from negative demand shocks. Exploiting variation between U.K. firms’ customer base exposure to the cost-of-living crisis, this study investigates the firm adoption and implications of “Buy Now, Pay Later” (BNPL) technology. Employing matched difference-in-differences and triple-differences estimations, results show that firms in industries with demand that is more elastic to the income of young households are more likely to adopt BNPL after the cost-of-living crisis. Further, BNPLadopting firms show higher sales, profitability, and survival rate compared to nonadopters. The findings speak to the effects of the consumer financial constraints on firm-level FinTech adoption during macroeconomic shocks, and demonstrate how BNPL technology helps mitigate a negative consumer demand shock for firms.

Published: 9 October 2025