IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v16y2024i4p1404-d1335191.html

Digital Financial Inclusion and Innovation of MSMEs

Author

Listed:
  • Jingwen Sun

    (School of Economics, Renmin University of China, Beijing 100872, China)

  • Jie Zhang

    (School of Economics, Renmin University of China, Beijing 100872, China)

Abstract

Digital inclusive finance is a new type of financial service that combines digital finance with inclusive finance. It is of great significance for improving the accessibility of financial services for small- and medium-sized enterprises and promoting their development. In this paper, we merge the Peking University Digital Financial Inclusion Index of China with the innovation data of micro-, small-, and medium-sized enterprises (MSMEs) from the National Bureau of Statistics, verify the facilitating effect of the development of digital financial inclusion on the technological innovation of MSMEs, and explain the mechanism of the influence of digital finance on the innovation of MSMEs from the perspective of alleviating financing constraints and promoting consumption. Digital inclusive finance has a promoting effect on the technological innovation of enterprises of different technological levels, but the support for high-tech enterprises is still insufficient. The heterogeneity analysis found that there are significant differences in the regional effects of digital financial inclusion; the central and western regions compared to the eastern region have better performance of digital inclusive finance to promote enterprise innovation.

Suggested Citation

  • Jingwen Sun & Jie Zhang, 2024. "Digital Financial Inclusion and Innovation of MSMEs," Sustainability, MDPI, vol. 16(4), pages 1-18, February.
    • Handle: RePEc:gam:jsusta:v:16:y:2024:i:4:p:1404-:d:1335191
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/16/4/1404/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/16/4/1404/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Lu, Xiaomeng & Zhang, Xianjun & Guo, Jiaojiao & Yue, Pengpeng, 2024. "Digital finance era: Will individual investors become better players?," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 91(C).
    2. Orazio P. Attanasio & Nicola Pavoni, 2011. "Risk Sharing in Private Information Models With Asset Accumulation: Explaining the Excess Smoothness of Consumption," Econometrica, Econometric Society, vol. 79(4), pages 1027-1068, July.
    3. Morten Linnemann Bech & Yuuki Shimizu & Paul Wong, 2017. "The quest for speed in payments," BIS Quarterly Review, Bank for International Settlements, March.
    4. Li, Jie & Wu, Yu & Xiao, Jing Jian, 2020. "The impact of digital finance on household consumption: Evidence from China," Economic Modelling, Elsevier, vol. 86(C), pages 317-326.
    5. Roberto Fontana & Marco Guerzoni, 2008. "Incentives and uncertainty: an empirical analysis of the impact of demand on innovation," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 32(6), pages 927-946, November.
    6. Ce Guo & Xijian Wang & Gecheng Yuan, 2022. "Digital Finance and the Efficiency of Household Investment Portfolios," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 58(10), pages 2895-2909, August.
    7. Reto Foellmi & Josef Zweimuller, 2006. "Income Distribution and Demand-Induced Innovations," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 73(4), pages 941-960.
    8. Emara, Noha & Zhang, Yuanhao, 2021. "The non-linear impact of digitization on remittances inflow: Evidence from the BRICS," Telecommunications Policy, Elsevier, vol. 45(4).
    9. Yang, Bo & Ma, Fang & Deng, Weihua & Pi, Yang, 2022. "Digital inclusive finance and rural household subsistence consumption in China," Economic Analysis and Policy, Elsevier, vol. 76(C), pages 627-642.
    10. Chen, Zhiyuan & Zhang, Jie, 2019. "Types of patents and driving forces behind the patent growth in China," Economic Modelling, Elsevier, vol. 80(C), pages 294-302.
    11. Steven N. Kaplan & Luigi Zingales, 1997. "Do Investment-Cash Flow Sensitivities Provide Useful Measures of Financing Constraints?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 112(1), pages 169-215.
    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. Emma Verónica Ramos Farroñán & Marco Agustín Arbulú Ballesteros & Francisco Segundo Mogollón García & Flor Delicia Heredia Llatas & Gary Christiam Farfán Chilicaus & María de los Ángeles Guzmán Valle , 2024. "Sustainability and Rural Empowerment: Developing Women’s Entrepreneurial Skills Through Innovation," Sustainability, MDPI, vol. 16(23), pages 1-17, November.
    2. Shang, Xiaoye & Liu, Canhui, 2026. "Impact of digital inclusive finance on firm employment growth," Finance Research Letters, Elsevier, vol. 90(C).

    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. Li, Shuang & Xie, Nan, 2025. "The impact of digital finance on firms' digital Transformation: Mechanism analysis based on enterprise financing," International Review of Economics & Finance, Elsevier, vol. 101(C).
    2. Dongjing Chen & Xiaotong Guo, 2023. "Impact of the Digital Economy and Financial Development on Residents’ Consumption Upgrading: Evidence from Mainland China," Sustainability, MDPI, vol. 15(10), pages 1-25, May.
    3. Ao Yang & Mao Yang & Fuyong Zhang & Aza Azlina Md Kassim & Peixu Wang, 2024. "Has Digital Financial Inclusion Curbed Carbon Emissions Intensity? Considering Technological Innovation and Green Consumption in China," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(4), pages 19127-19156, December.
    4. 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.
    5. Zhang, Jian & Li, Ting & He, Yuhui & Li, Zhaohui, 2025. "Does land transfer-out facilitate an upgrade in farmers’ consumption," Economic Analysis and Policy, Elsevier, vol. 85(C), pages 2219-2233.
    6. Guo, Xingfang & Wei, Tao & Wang, Aiping & Hu, Haifeng, 2024. "Corporate governance effects of digital finance: Evidence from corporate tax avoidance in China," Research in International Business and Finance, Elsevier, vol. 72(PA).
    7. 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.
    8. Li, Jialong & Li, Jiao, 2025. "Does climate risk impact household consumption? Evidence from China," Economic Modelling, Elsevier, vol. 152(C).
    9. Zhou, Chao & Liao, Jinglin, 2024. "Home country digital finance development and post-entry internationalization speed of emerging market SMEs: Empirical evidence from China," International Review of Financial Analysis, Elsevier, vol. 91(C).
    10. Dong, Jingxuan, 2024. "Digital finance’s impact on household portfolio diversity: Evidence from Chinese households," Finance Research Letters, Elsevier, vol. 70(C).
    11. Hongyi Wang & Yi Li & Bingyang He, 2024. "Spatial Spillover Effects of Digital Finance on Corporate ESG Performance," Sustainability, MDPI, vol. 16(16), pages 1-20, August.
    12. Wang, Siquan & Du, Anna Min & Lin, Boqiang, 2025. "Micro-mechanisms of digitalization-driven financing for renewable energy: Growing capital pools and shifting flows," Research in International Business and Finance, Elsevier, vol. 73(PA).
    13. Lee, Chien-Chiang & Lou, Runchi & Wang, Fuhao, 2023. "Digital financial inclusion and poverty alleviation: Evidence from the sustainable development of China," Economic Analysis and Policy, Elsevier, vol. 77(C), pages 418-434.
    14. 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).
    15. Zhang, Jiaping & Zhang, Huirong & Gong, Xiaomei, 2022. "Mobile payment and rural household consumption: Evidence from China," Telecommunications Policy, Elsevier, vol. 46(3).
    16. Liu, Qiongzhi & Li, Renke & Wang, Yuqin, 2024. "Digital finance and capital mobility: Evidence from cross-regional investment of listed companies in China," Pacific-Basin Finance Journal, Elsevier, vol. 87(C).
    17. Lanxin Sun & Zhenting Lin & Baowei Lai, 2025. "Examining the Impact of Digital Inclusive Finance on Urban and Rural Consumption Patterns: Insights from China Household Finance Survey in 11 Coastal Regions," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 16(3), pages 12809-12842, September.
    18. Yanyang Yan & Juan Wang & Sijia Qiao, 2022. "Effects of Industrial Policy on Firms’ Innovation Outputs: Evidence From China," SAGE Open, , vol. 12(3), pages 21582440221, September.
    19. Wang, Haijing & Meng, Chao, 2025. "Digital finance and rural household consumption," Finance Research Letters, Elsevier, vol. 86(PG).
    20. Wen Chen, 2023. "Digital economy development, corporate social responsibility and low‐carbon innovation," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 30(4), pages 1664-1679, July.

    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:gam:jsusta:v:16:y:2024:i:4:p:1404-:d:1335191. 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: MDPI Indexing Manager The email address of this maintainer does not seem to be valid anymore. Please ask MDPI Indexing Manager to update the entry or send us the correct address (email available below). General contact details of provider: https://www.mdpi.com .

    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.