The Road to Default is Paved with Good Intentions: Motivational Values As Predictors of Loan Securing and Repayment in Crowdfunded Microlending

Crowdlending investors must decide not only whether a borrower is worthy of funding, but also whether that borrower is likely to honor a financial obligation over time. Although prior research shows that entrepreneurial narratives shape funding decisions, less is known about whether the motivational values expressed in those narratives predict subsequent repayment behavior. Using archival data from 386,539 loan narratives on the Kiva platform, we examine how expressed motivational values relate to both funding success and loan delinquency. Drawing on Schwartz’s higher-order value framework, we classify narrative expressions of self-transcendence, self enhancement, openness to change, and conservation using an LLM-assisted approach. We find that all four motivational value expressions increase the likelihood and speed of funding. Yet these same signals differ in their diagnostic validity: self transcendence and openness to change are associated with lower delinquency, whereas self-enhancement and conservation are associated with higher delinquency. Our findings reveal a divergence between persuasive and performance-predictive narrative signals in debt crowdfunding, showing that the values that help entrepreneurs mobilize capital are not always the same values that signal reliable follow-through. The study contributes to entrepreneurial storytelling and signaling theory by clarifying when motivational narratives function as persuasive appeals and when they provide diagnostically valid information about borrower reliability.