Study on Financing Constraints of Small and Medium-sized Enterprises Eased by Financial Technology

Small and medium-sized enterprises (SMEs) are increasingly important for economic growth, employment opportunities, and innovation. However, the traditional financial system has failed to meet its diverse financing needs, especially in terms of information asymmetry and risk assessment. There is a lack of systematic theoretical analyses and empirical tests on how FinTech affects the financing constraints of SMEs. This paper explores in detail the role of information asymmetry, leverage, and financial sector concentration in the financing process of SMEs through an in-depth study of the mechanism of FinTech's impact on SMEs' financing constraints. The results of the study show that the development of FinTech has a significant effect on alleviating the financing constraints of SMEs. In addition, this study finds that FinTech is particularly effective in alleviating the financing constraints of SMEs in the eastern region. However, in the Western region, the financing difficulties faced by SMEs are still severe. Therefore, the state should vigorously promote the development of fintech, especially in the less developed regions in the West, with a view to reducing the imbalance between the East and West in terms of economic development, and thus promoting balanced development nationwide.