Nexus among digital inclusive finance and carbon neutrality: Evidence from company-level panel data analysis

This research examined the effects of digital finance and renewable energy investment on carbon neutrality using Chinese companies' panel data from 2005 to 2020 in 30 Chinese provinces. The findings demonstrate that inclusive digital financing may directly lower carbon intensity. It can also impact carbon intensity by enhancing the industrial structure and resource efficiency and encouraging green technologies. The marginal impact of digital financing is lower for big enterprises (larger for small firms). This is in line with the reality that small businesses face more difficulties in accessing finance. Digital finance opens new funding avenues for such businesses to achieve sustainability. The inclusive feature of digital financing, as opposed to conventional banking, may enhance private businesses' green innovation.

Automated summary

This research examines the impact of digital finance and renewable energy investment on carbon neutrality using panel data of Chinese companies in 30 provinces from 2005 to 2020. The study finds that inclusive digital financing can directly reduce carbon intensity and also influence it through improving industrial structure, resource efficiency, and promoting green technologies. The marginal impact of digital financing is smaller for large enterprises (larger for small firms), reflecting the challenges small businesses face in accessing finance. Digital finance opens new funding avenues for these businesses to achieve sustainability. The inclusiveness of digital financing, compared to traditional banking, can enhance private businesses' green innovation.