Abstract
The rapid growth of China's financial technology has had a significant impact on businesses. The study of the relationship between macrofinancial technology and microbusinesses has important theoretical and practical implications. We empirically examined the relationship between FinTech, financing constraints, and corporate liquidity using the China Provincial Fintech Development Index and the data of A-share manufacturing companies listed on the Shanghai and Shenzhen Main Boards between 2011 and 2020. We found that financing constraints have a negative effect on a company's liquidity. The greater the constraints on corporate financing, the worse the liquidity. However, financial technology will have positive external effects and will mitigate the negative effect of financing constraints on corporate liquidity. In addition, we find that non-state-owned enterprises, small and medium-sized enterprises, and young enterprises face greater financing constraints and are thus more impacted by FinTech.
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