Digital inclusive finance, digital technology application and entrepreneurial activity: evidence from China’s provincial panel data

Purpose Solving the problem of financial constraints is key to reducing the barrier to entrepreneurship. Digital inclusive finance, which depends on digital technology, provides entrepreneurs with additional financing options. However, few studies have explained the specific relationship and mechanism between the three. Thus, this study explores how digital inclusive finance affects regional entrepreneurial activity and how this influence fluctuates when digital technology application is included. Design/methodology/approach The panel fixed effect, moderating effect and panel threshold models are utilized to explore the relationships among digital inclusive finance, digital technology application and entrepreneurial activity. Findings The results demonstrate that the growth of digital inclusive finance significantly promotes entrepreneurial activity; nevertheless, digital technology application exerts a detrimental moderating effect on this promotion effect. The impact of digital inclusive finance on entrepreneurial activity is nonlinear, with a significant triple threshold when digital technology application and digital inclusive finance are used as threshold variables. More specifically, after digital inclusive finance reaches a certain level, it will show a trend of first rising and then falling in its promotion effect on entrepreneurial activity. With increased digital technology application, the promotion effect of digital inclusive finance on entrepreneurial activity shows a marginal decreasing trend. Originality/value This study first includes digital inclusive finance, entrepreneurial activity and digital technology application in the same framework. The research findings highlight that developing digital inclusive finance and optimizing digital technology applications to encourage “mass innovation and entrepreneurship” is crucial.