Enabler or Divider? The Enabling Effects and Digital Divide Consequences of Digital Inclusive Finance on Regional Entrepreneurship

This study investigates the impact of digital inclusive finance on regional entrepreneurship using panel data from 327 Chinese cities spanning 2011 to 2023. Employing bidirectional fixed effects models, mediation analysis, and heterogeneity analysis, we find that digital inclusive finance significantly boosts regional entrepreneurial activity, a result that remains robust after addressing endogeneity and replacing core indicators. Mechanism analysis reveals that digital inclusive finance promotes entrepreneurship through three primary channels: alleviating credit constraints, enhancing financial service efficiency, and fostering technological innovation. Heterogeneity tests further indicate that the promotional effect is most pronounced in economically developed large cities in eastern China, while its impact remains limited in small and medium-sized cities in central and western regions. Consequently, the development of digital finance has, to some extent, widened the regional “digital divide”. These findings suggest that while digital inclusive finance is a powerful tool for economic vitality, policymakers must implement differentiated strategies to prevent exacerbated regional imbalances and ensure coordinated entrepreneurial development.