In this paper, whether and how digital
inclusive finance affects households’ formal credit are discussed. Based on the
data of China Household Finance Survey from 2013 to 2017 and the province-level
DFI index, we find that compared with traditional financial services, digital
inclusive finance has higher flexibility, which can effectively reduce
information asymmetry and transaction costs, and digital payment channels also
significantly improve households’ access to formal credit. However, it is found
that the government intervention has a negative impact on household formal
credit, which may be due to policy differences or regional discrimination.
Therefore, when deepening the development strategy of digital inclusive
finance, it is necessary to strengthen the construction of digital financial
infrastructure, especially in rural areas and the central and western regions,
so as to improve the underdeveloped situation of digital financial services.
Additionally, it is necessary to develop tailored policy measures for different
households when a comprehensive approach that considers various factors, such
as education level, income level, and geographic differences.
JEL classification numbers: D12, G21, G28.
Keywords: Digital inclusive finance, Household formal credit, Credit
availability, Government intervention.