The Impact of Digital Inclusive Finance on Rural Household Financial Vulnerability: An Analysis based on the Ordered Probit Model

Abstract

The vulnerability of household finance is an extension of the research field of household finance, which has received widespread attention from scholars both domestically and internationally. Especially in rural areas of China, where economic development is relatively lagging and household income levels are low, the degree of financial vulnerability is more significant. In recent years, the vigorous development of digital inclusive finance has to some extent improved the accessibility of financial services for rural residents, providing new ideas and approaches to alleviate this problem. Therefore, in-depth exploration of the impact and mechanism of digital inclusive finance on the financial vulnerability of rural households is of great theoretical and practical significance for improving household financial welfare and maintaining financial stability. This article uses the Peking University Digital Inclusive Finance Index and the 2019 China Household Finance Survey (CHFS2019) data to empirically test the impact and mechanism of digital inclusive finance on rural household financial vulnerability using the Oprobit model and mediation effect model. The research results show that the development of digital inclusive finance can significantly reduce the financial vulnerability of rural households; The mediation effect analysis shows that the financial literacy of farmers plays a significant mediating role in it. Based on the above research conclusions, this article believes that continuously promoting the development of digital inclusive finance and deepening the reform of rural financial services have extremely important practical significance. This not only helps to further enhance the financial well-being of rural households, but also provides strong support for the sustainable economic development of rural areas, while laying a solid foundation for the stability and improvement of China's financial system.