Can cooperating with technology companies increase the agricultural loans supply of commercial banks?

This article analyzes the effects of cooperation between commercial banks and technology companies on agricultural lending in China, using data from 235 commercial banks spanning from 2012 to 2021. It uniquely provides deeper insights into the cooperation patterns between banks and technology companies in China. Approximately 59.1489% of the sampled banks had signed fintech cooperation contracts, transitioning from a technology cooperation model to a technology-capital cooperation model, which was adopted by approximately 28.9362% of the banks. In contrast to the existing literature, our analysis provides empirical evidence to advance the understanding of how establishing cooperation relationships with technology companies can enhance the supply of agricultural loans. We find that fintech cooperation boosts the proportion of agricultural loans by 1.1758%, compared to banks that have not partnered, and alleviates information asymmetry. Notably, technology cooperation plays a more prominent role in the supply of agricultural loans than capital cooperation. Heterogeneity analysis highlights a strong positive impact for local banks. Therefore, refining benefit-sharing mechanisms to stabilize cooperative relationships and prioritizing fintech for improved communication and information sharing is crucial. Furthermore, regulators should recognize the value of these collaborations in advancing financial inclusion and incentivize successful partnerships, especially for local banks.