FinTech adoption and rural economic development: Evidence from China

In the context of China's rural economic landscape, the emergence of Financial Technology (FinTech) has induced transformative economic impact. This study utilizes a composite county-level FinTech index and data from China's National Fixed Point Survey (NFS) to analyze the impact of FinTech adoption on rural economic development. The empirical findings outline a positive correlation between FinTech adoption and enhancement in rural household earnings, especially on wage and property incomes, thus narrowing urban-rural income gap. For wage income, we find that FinTech has provided new non-agricultural employment opportunities to rural households, especially in service sectors closely related to FinTech. For property income, the development of FinTech has provided effective financial services and supported the operations of rural enterprises, thereby increasing dividend payments to rural households who contribute their unused arable land to these enterprises due to labor transformation from agriculture to non-agricultural sectors. This research extends the existing studies of FinTech literature by illustrating its role in fostering rural economic growth within the Asia-Pacific emerging markets. •We explore how FinTech adoption affects rural economic development.•Higher FinTech has a positive effect on rural household income.•The effect is more significant in wage and property incomes.•FinTech has provided new employment opportunities to rural households.•FinTech development has supported the operations of rural enterprises.