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Digital economy and entrusted loans: Evidence from shadow banking

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  • Huang, Wei
  • Yang, Fan
  • Zhu, Yixin

Abstract

Entrusted loans represent a vital component of shadow banking in China and have significant implications for financial system stability. Taking advantage of a sample covering all A-share traded Chinese firms from 2013 to 2022, this research explores the impact of the digital economy on entrusted loans. We display that the level of the digital economy reduces the scale of entrusted loans by strengthening bank risk management and increasing corporate financing options. Further analysis shows that banking competition can amplify the negative link we found. Overall, this study advances extant literature on the digital economy and shadow banking.

Suggested Citation

  • Huang, Wei & Yang, Fan & Zhu, Yixin, 2025. "Digital economy and entrusted loans: Evidence from shadow banking," Finance Research Letters, Elsevier, vol. 73(C).
    • Handle: RePEc:eee:finlet:v:73:y:2025:i:c:s1544612324014326
    DOI: 10.1016/j.frl.2024.106403
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    References listed on IDEAS

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    Cited by:

    1. Yu, Shuangli, 2025. "In the shadow of banks: Entrusted wealth management and capital allocation efficiency," Finance Research Letters, Elsevier, vol. 76(C).

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