Fintech Enablement of Corporate Digital Transformation

Abstract

Amidst the accelerated reorganization of the global digital economy landscape and China's rapid FinTech advancement, this study employs empirical methods to investigate FinTech's influence on corporate digital transformation dynamics and its underlying mechanisms. Utilizing data from Shanghai and Shenzhen-listed A-share companies spanning 2003 to 2023, findings indicate that an incremental rise in the FinTech development index correlates with a significant enhancement in firms' digital transformation levels. Analysis of the causal pathways reveals that FinTech facilitates this transformation primarily through two synergistic channels: mitigating corporate financing difficulties and reducing internal transaction costs. The exploration of heterogeneity reveals that firms with specific characteristics experience a more pronounced transformation impetus. Non-state-owned entities, coastal enterprises, and those within high-tech sectors effectively leverage institutional frameworks and infrastructure endowments to achieve stronger enabling effects. Conversely, state-owned enterprises exhibit relatively muted responsiveness, hindered by institutional rigidities and technological access barriers. Critically, a firm's technological innovation capability exerts a significant positive moderating influence on FinTech's transformation-enabling effect, underscoring the pivotal role of technological adaptation and assimilation. Collectively, these results provide empirical evidence for understanding FinTech's role as a catalyst for corporate digital transformation, thereby informing the design of targeted policy interventions, including geographically tailored support strategies.