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Intelligent finance development and shadow banking

Author

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  • Zeng, Linggang
  • He, Yuhang
  • Ma, Dan

Abstract

Amid financial repression, nonfinancial enterprises with access to low-cost capital use shadow banking to channel funds to underfinanced firms. While intelligent finance (IF) improves financial efficiency, its effectiveness and mechanism for combating shadow banking remain unclear. We construct a city-level IF development index using Chinese data. The sequential linear panel data estimator shows that IF significantly reduces nonfinancial firms’ shadow banking, both lending and borrowing, by reducing the nonperforming loan ratio while increasing bank credit availability.

Suggested Citation

  • Zeng, Linggang & He, Yuhang & Ma, Dan, 2025. "Intelligent finance development and shadow banking," Finance Research Letters, Elsevier, vol. 81(C).
    • Handle: RePEc:eee:finlet:v:81:y:2025:i:c:s1544612325006907
    DOI: 10.1016/j.frl.2025.107430
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    References listed on IDEAS

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