Does digital financial inclusion lead to regional differences in trade credit financing?: A quasi-natural experiment

The People's Bank of China (PBOC) drafted the G20 High-Level Principles for Digital Financial Inclusion in 2016. Employing these principles in a quasi-natural experiment, we use the differencein-difference (DID) method to estimate changes in enterprises' trade credit financing (TCF). The findings are as follows: First, digital financial inclusion (DFI) significantly increases enterprises' TCF in China's central and western regions, and the policy effect is transmitted through bank credit and the level of digital finance development. Second, DFI's effects on enterprises are heterogeneous with different ownership structures and sizes and in different industries; the promotive effect on TCF is stronger for non-state-owned enterprises (non-SOEs) and nonmanufacturing enterprises, while the policy prohibits the TCF of small and medium enterprises. Third, provincial factors have positive moderating effects on DFI.