The role of digital inclusive finance in rural revitalization: Mediating effects of infrastructure and education

Abstract

To explore in depth the impact of digital inclusive finance (DIF) on rural revitalization, this study employs the entropy method to measure the level of rural revitalization across 30 provincial-level administrative regions in mainland China from 2014 to 2023. It further conducts an empirical test on the relationship between the two variables and the mediating paths using the two-way fixed effects model and the mediating effect model. The study finds that DIF directly improves rural revitalization by 6.5%. Mediation tests reveal digital infrastructure (22.2% of total effect) lowers transaction costs, while education (24.8%) enhances financial literacy. Heterogeneity analysis shows coverage breadth (5.2%) contributes most among DIF sub-indices, followed by usage depth (2.6%) and digitization (2.2%). At the practical level, this study provides operational guidance for local governments and financial institutions, such as prioritizing the establishment of village-level service stations and optimizing regional resource allocation. It also offers evidence for policymakers to improve assessment indicators and develop differentiated policy frameworks, with its findings holding reference value for developing countries worldwide.