The Impact of Inclusive Finance on Reducing the Urban-Rural Income Gap in Henan Province: An Analytical Study

China is undergoing a transition from being a major technology importer to becoming a leading technology innovator, with rapid digital transformation across its economy and society. The accessibility of financial services is emerging as a crucial platform that supports comprehensive economic and social development, significantly contributing to economic growth. However, during this process, Henan Province, known for its agricultural modernization initiatives and large agricultural population, has experienced a steady increase in farmers' incomes and significant shifts in income structure. Nonetheless, considerable income disparities remain among different regions, and the development levels of inclusive finance vary significantly, highlighting substantial imbalances. In this context, this article examines 17 prefecture-level cities in Henan Province, calculating the inclusive finance index for each city from 2010 to 2021, and investigates the relationship between inclusive finance and the urban-rural income gap. Panel data analysis indicates that enhancing the level of inclusive finance can reduce the urban-rural income gap. Based on the findings, the article proposes policy recommendations from the perspective of inclusive finance to further narrow the urban-rural income gap in Henan Province. Rural finance is deemed the cornerstone of the modern rural economy. This study elucidates the vital role of inclusive finance in rural economic development and urban-rural income equilibrium and how fostering the development of inclusive finance can drive rural economic growth and balanced income growth between urban and rural residents.