Digitizing Prosperity: How Digital Finance Transforms Agricultural Incomes in China

The inclusion of digital finance provides vital financial support for rural revitalization and farmer income, and it has emerged as a significant impetus for social and economic growth. This study uses a spatial measurement model to assess the impact of DIF on FI, based on panel data sets from 2011 to 2020 in 31 provinces of China. The following conclusions were drawn: First, DIF expands financial services, lowers the threshold of financial services, alleviates financial exclusion through advanced digital technologies, promotes financial institutions to serve rural areas, and continuously releases “digital dividends” to rural areas. Second, the development of DIF mainly promotes FI through digital payment, credit, and insurance; this, in turn, indirectly promotes farmers’ income through regional economic growth agglomeration characteristics of “low–low.” Third, the development of DIF plays a vital role in the income structure, promoting wage, property, and transfer income. However, it is not apparent in household operating income due to DIF being in rural areas’ early stages of development. Finally, the income-increasing effect of DIF is regionally heterogeneous, manifesting better in the eastern region than in the western and central regions.