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Financial technology (FinTech) is transforming traditional financial services and has a significant impact on business performance. This study investigates how FinTech affects the performance of businesses in China. It constructs a FinTech Index based on data from the Baidu Search Index and aligns this index with the financial data of publicly listed Chinese companies over the period from 2011 to 2021. We find that the development of FinTech positively affects corporate performance improvement through external and internal environment mechanisms. The findings reveal that FinTech significantly contributes to business performance by enhancing information transparency, alleviating financing constraints, and improving the efficiency of corporate investment environments. Additionally, we find that the impact of FinTech development on corporate performance exhibits heterogeneity. The beneficial effects of FinTech on corporate performance are particularly noticeable in in eastern regions, groups with lower levels of centralization, and areas with weaker regulatory oversight. The empirical results can be used to help emerging market firms improve their performance and assist investors in identifying worthwhile investment prospects.
Li et al. (Wed,) studied this question.