IDEAS home Printed from https://ideas.repec.org/a/eee/finlet/v85y2025ipcs1544612325013297.html

Impact of digital financial inclusion on rural revitalization

Author

Listed:
  • Chen, Yiru
  • Liu, Li
  • Zheng, Sufang

Abstract

Using panel data from 30 provinces in China spanning 2011–2022, this study takes digital financial inclusion as the core explanatory variable and rural revitalization as the explained variable. We construct a double fixed-effects model from a macro perspective to systematically investigate the mechanism of digital finance on rural revitalization, the mediating effect of farmers’ entrepreneurial activity, and the regulatory mechanism of digital infrastructure. Results reveal that: first, digital financial inclusion has a significant promotional effect on rural revitalization, and the analysis of regional heterogeneity shows that rural villages in the western region benefit more prominently, confirming the potential of bridging the digital divide to empower less-developed regions. Second, the mechanism test reveals that the farmers’ entrepreneurial activity, driven by digital financial inclusion, plays a significant mediating role in rural revitalization, indicating that the sinking of financial resources indirectly promotes rural development by stimulating the vitality of microentrepreneurs. This study explains the structural dynamics of digital technology-enabled rural development through the transmission path of “financial inclusion-entrepreneurial activation-village transformation,” providing policy insights for optimizing regional layout of digital finance, strengthening infrastructural adaptability, and successfully activating farmers’ endogenous motivation.

Suggested Citation

  • Chen, Yiru & Liu, Li & Zheng, Sufang, 2025. "Impact of digital financial inclusion on rural revitalization," Finance Research Letters, Elsevier, vol. 85(PC).
    • Handle: RePEc:eee:finlet:v:85:y:2025:i:pc:s1544612325013297
    DOI: 10.1016/j.frl.2025.108071
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1544612325013297
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.frl.2025.108071?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. Su, Yu, 2025. "Perceived corporate individualism culture and corporate bond issuing costs," International Review of Financial Analysis, Elsevier, vol. 103(C).
    2. Shao-Chieh Hsueh & Shuying Jiang & Shuoxun Zhang, 2024. "Digital Finance and Settlement for Long Term: Evidence from Rural-Urban Migrants," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 60(8), pages 1841-1857, June.
    3. Konstantakis, Konstantinos N. & Koulmas, Pavlos & Michaelides, Panayotis G. & Porcher, Thomas & Prelorentzos, Arsenios-Georgios N., 2025. "Green bonds & clean energy in sustainable finance: Evidence from DCC-GARCH connectedness," International Review of Financial Analysis, Elsevier, vol. 103(C).
    4. Huang, Yuyun Claudie & Tong, Jamie Yixing & Yang, Joey W., 2025. "Does external labour market activeness affect agency problem?," International Review of Financial Analysis, Elsevier, vol. 103(C).
    5. Zhao, Xiuli & Lin, Haili & Zhang, Wenjuan, 2025. "Can digital inclusive finance promote rural revitalisation?," Finance Research Letters, Elsevier, vol. 85(PB).
    6. Lyu, Wenyi & Yu, Leng & Zhang, Jiajun, 2024. "Peer effects in digital inclusive finance participation decisions: Evidence from rural China," Technological Forecasting and Social Change, Elsevier, vol. 208(C).
    7. Yifeng Zhang & Min-Xuan Ji, 2024. "From pixels to production: the impact of digital finance on the industrial fabric of rural China," China Agricultural Economic Review, Emerald Group Publishing Limited, vol. 16(3), pages 527-544, May.
    8. Fu, Changluan & Sun, Xinyue & Guo, Mengting & Yu, Chenyang, 2024. "Can digital inclusive finance facilitate productive investment in rural households?–An empirical study based on the China Household Finance Survey," Finance Research Letters, Elsevier, vol. 61(C).
    9. Li, Xinge & Chang, Zheren & Qi, Jiangyi, 2025. "Foreign investment policy, market entry and corporate ESG performance," International Review of Financial Analysis, Elsevier, vol. 103(C).
    10. Wu, Yanxia & Zhang, Jie, 2025. "Digital inclusive finance and rural households’ economic resilience," Finance Research Letters, Elsevier, vol. 74(C).
    11. Jianwei Gao & Yuxin Wu & Haiwei Li, 2024. "Digital Inclusive Finance, Rural Loan Availability, and Urban–Rural Income Gap: Evidence from China," Sustainability, MDPI, vol. 16(22), pages 1-25, November.
    12. Xu, Zhiyi & Yang, Jindi, 2025. "Impact of digital finance on rural industry revitalization," International Review of Economics & Finance, Elsevier, vol. 97(C).
    13. Wang, Yuyu & Zhao, Zengli & Lu, Chen, 2024. "Does digital inclusive finance increase land rent? Evidence from rural China," Economic Analysis and Policy, Elsevier, vol. 82(C), pages 1025-1043.
    14. Wang, YiZheng & Zhang, ZhenTian, 2025. "Digital development and rural financial inclusion: Evidence from China," Research in International Business and Finance, Elsevier, vol. 73(PA).
    15. Zhan, Yunqiu & Gao, Dongfei & Feng, Muzi & Yan, Shen, 2025. "Digital finance, non-agricultural employment, and the income-increasing effect on rural households," International Review of Financial Analysis, Elsevier, vol. 98(C).
    16. Huang, Zhenzhen & Han, Junyi & Xu, Zhaoyi & Dai, Rui, 2025. "Digital financial inclusion and urban-rural disparities," International Review of Economics & Finance, Elsevier, vol. 104(C).
    17. Gong, Qinyi & Zhang, Rui, 2025. "Digital finance as a catalyst for energy transition and sustainable rural economic growth," Finance Research Letters, Elsevier, vol. 71(C).
    18. Chenwei Yu & Eddie Chi-man Hui & Zhaoyingzi Dong, 2024. "Digital inclusive finance and entrepreneurship in rural areas: evidence from China," China Agricultural Economic Review, Emerald Group Publishing Limited, vol. 16(4), pages 712-730, June.
    19. Chunyan He & Lu Zhou & Fang Qu & Peng Xue, 2025. "How Does Digital Financial Inclusion Affect Rural Land Transfer? Evidence from China," Land, MDPI, vol. 14(9), pages 1-30, August.
    20. Hambel, Christoph & van der Sanden, Floor, 2025. "Reevaluating the carbon premium: Evidence of green outperformance," International Review of Financial Analysis, Elsevier, vol. 102(C).
    21. Xiaosen Du & Shiyu Wu & Jing Zhou, 2025. "How does digital finance affect rural capital misallocation? Evidence from China," Applied Economics, Taylor & Francis Journals, vol. 57(18), pages 2241-2254, April.
    22. Lin, Han & Peng, Pin, 2025. "Impacts of Digital Inclusive Finance, Human Capital and Digital Economy on Rural Development in Developing Countries," Finance Research Letters, Elsevier, vol. 73(C).
    23. Wei Li & Lu Zhang & Mingyue Pu & Hui Wang, 2025. "Digital inclusive finance, rural revitalization and rural consumption," PLOS ONE, Public Library of Science, vol. 20(1), pages 1-20, January.
    24. Ren, Jingjing & Wu, Bo, 2025. "Digital village, inclusive finance, and consumption upgrading in rural areas," Finance Research Letters, Elsevier, vol. 85(PD).
    25. Jiang, Lixia & Cao, Xiaojing & Wang, Zeyu & Zhan, Yun & Zhang, Jiali & Chen, Shuai, 2025. "Promoting energy saving and emission reduction benefits in small and medium-sized enterprises supply chains through green finance - Evidence based on artificial intelligence intervention," International Review of Financial Analysis, Elsevier, vol. 102(C).
    26. Bi, Jiayin, 2024. "Can rural areas in China be revitalized by digitization? A dual perspective on digital infrastructure and digital finance," Finance Research Letters, Elsevier, vol. 67(PA).
    27. Xiaohui Sun & Zhijian Cai & Chongyu Wang & Jing Wang, 2024. "The Impact of Digital Inclusive Finance on Residents’ Cultural Consumption in China: An Urban-Rural Difference Perspective," Sustainability, MDPI, vol. 16(24), pages 1-18, December.
    28. Wu, Meidianzi, 2025. "Digital Inclusive Finance, Rural E-Commerce, and Urban-Rural Income Gap," GBP Proceedings Series, Scientific Open Access Publishing, vol. 3, pages 35-43.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Prashasti Keshari & Awadhesh Kumar Tiwari, 2026. "Financial inclusion in rural region—a review and research agenda," Future Business Journal, Springer, vol. 12(1), pages 1-25, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Zeng, Yuhan & Zhou, Xia, 2025. "The dynamic relationship among digital inclusive finance, integration of industries in rural areas, and rural revitalization," Finance Research Letters, Elsevier, vol. 85(PA).
    2. Gao, Lu & Li, Bin, 2025. "Development of inclusive finance, digital infrastructure, and the urban–rural education gap," Finance Research Letters, Elsevier, vol. 86(PF).
    3. Lin, Siyuan & Miao, Shuchao, 2025. "The enhancing effect and role path of digital finance on the resilience of agricultural industry chain," Finance Research Letters, Elsevier, vol. 83(C).
    4. Xu, Siyun & Ma, Zhiyue, 2025. "Insurance density, financial accessibility, and the upgrade of resident consumption," Finance Research Letters, Elsevier, vol. 86(PF).
    5. Qin, Teng & Qin, Chuan & Wang, Jiaxin & Xing, Haiyan, 2025. "Can the digital economy enhance enterprises' breakthrough innovation?," International Review of Financial Analysis, Elsevier, vol. 104(PA).
    6. Xie, Junming, 2025. "Banking evolution in the digital age: How digital financial inclusion induces systematic financial risk?," Finance Research Letters, Elsevier, vol. 80(C).
    7. Feng, Yanchao & Yan, Tong & Hu, Shilei & Zhang, Zhenhua, 2025. "The impact of digital inclusive finance on household carbon emissions: Empirical evidence from China," International Review of Financial Analysis, Elsevier, vol. 102(C).
    8. Wang, Yang & Cai, Qiang, 2025. "Education fiscal expenditure, digital inclusive finance, and urban-rural education returns," Finance Research Letters, Elsevier, vol. 86(PG).
    9. Zhao, Fang & Merajuddin, Shaheem Sayed & Liu, Fanqi & Xu, Yi & Zhang, Yun, 2025. "Racing toward tourism sustainability: A spatial-temporal analysis," International Review of Financial Analysis, Elsevier, vol. 105(C).
    10. Zhao, Xiuli & Lin, Haili & Zhang, Wenjuan, 2025. "Can digital inclusive finance promote rural revitalisation?," Finance Research Letters, Elsevier, vol. 85(PB).
    11. Zheng, Ye & Bao, Xuhan & Zhao, Shijie, 2025. "Renewable energy policy and environmental governance performance," Finance Research Letters, Elsevier, vol. 82(C).
    12. Li Cheng & Yufei Zhang & Yang Xiang & Weiting Wang, 2026. "Research on the impact of rural digitization on the synergistic development of rural environment and economic systems: evidence from China," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 28(4), pages 10487-10524, April.
    13. Zhao, Qiao & Wang, Wangqing, 2025. "Digital transformation and rural financial development," Finance Research Letters, Elsevier, vol. 84(C).
    14. Zhang, Yuanchao & Yang, Yanbing & Chai, Yongdong & Liang, Tianmei & Li, Lingjun, 2025. "China's financial opening, green technical innovation and low-carbon economy," International Review of Economics & Finance, Elsevier, vol. 103(C).
    15. Xiaqun Liu & Yaming Zhuang & Xiaoyue Qiu, 2025. "Financial Support Efficiency of Rural Revitalization: Based on Three-Stage DEA Model and Malmquist Index Model," Sustainability, MDPI, vol. 17(3), pages 1-15, January.
    16. Pan, Yuyao & Guo, Xiaochuan, 2025. "Digital technology innovation, entrepreneurship and high-quality corporate development," Finance Research Letters, Elsevier, vol. 82(C).
    17. Chunyan He & Lu Zhou & Fang Qu & Peng Xue, 2025. "How Does Digital Financial Inclusion Affect Rural Land Transfer? Evidence from China," Land, MDPI, vol. 14(9), pages 1-30, August.
    18. Shi, Wenlei & Ying, Limeng & Ma, Guohua & Niu, Yanfang & Lv, Yuanyuan & Xu, Xiaofang, 2025. "Intelligent manufacturing, media attention, and sustainable development performance," International Review of Financial Analysis, Elsevier, vol. 106(C).
    19. Xiaoying Ren & Guobing Ruan & Yimeng Han & Dingding Zhang & Yaqi Wei & Yongzhong Feng, 2025. "Rural Industry Integration in Yan’an City: Development Trends, Driving Factors, and Regional Stratification," Sustainability, MDPI, vol. 17(4), pages 1-21, February.
    20. Chen, Juanjuan & Han, Huiyuan, 2025. "How does public green attention promote enterprises' greening strategies?," Finance Research Letters, Elsevier, vol. 85(PC).

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:finlet:v:85:y:2025:i:pc:s1544612325013297. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/frl .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.