An empirical analysis of rural farmers’ financing intention of inclusive finance in China

Abstract

Purpose The purpose of this paper is to investigate and understand China’s rural farmers’ financing intention of inclusive finance, and it examines related drivers like knowledge of inclusive finance, perceived benefits and perceived risks of ordering finance. Besides, the social enterprise embeddedness and digital finance are integrated into the conceptual model to further investigate their moderating impact. Design/methodology/approach The authors designed an inclusive finance intention model to examine the relations between dependent variable knowledge of inclusive finance, intermediary variables perceived benefits and perceived risks of ordering finance and the independent variable financing intention of inclusive finance. The embeddedness of social enterprise and digital finance were identified as modifying factors. Both exploratory and conclusive research strategies were applied. A structured questionnaire was developed to collect empirical data from the rural areas of China. Findings It suggests that knowledge of inclusive finance can strengthen both perceived benefits and perceived risk of ordering finance. Interestingly, the embeddness of social enterprise can significantly reduce risk perceptions and improve perceived benefits of ordering finance. Furthermore, perceived benefits of ordering finance can positively enhance rural farmers’ financing intention of inclusive finance, whereas perceived risks can negatively influence the financing intention. Moreover, digital finance as a modifying factor can significantly strengthen the positive correlation between perceived benefits of ordering finance and financing intention of inclusive finance. Practical implications The research indicates that a systematic inclusive finance educational project is needed to enhance rural farmers’ understanding of inclusive finance and its components. Moreover, the study reveals that it is crucial to promote social enterprise participation and digital finance to develop inclusive finance in rural China, as the service attributes of social enterprise and efficiency of digital finance can greatly reduce the existing transaction cost of farmers. Originality/value The conceptual model would potentially contribute to researchers interested in investigating the financing intention of inclusive financial services relating to rural population. The integration of social enterprise embeddedness and digital finance is the uniqueness of this research conceptual model.

Financing of Public-Private Partnership Projects Based on “Smart Technologies”

“…The financial aspect of dissemination of smart technologies is studied in the works Aisaiti et al (2019), Burger-Helmchen et al (2020, Preda and Muradoglu (2019), and Zhang et al (2019). Thus, the problem of financing of public-private partnership projects based on smart technologies has been studied fragmentarilythere is a clear emphasis on financing of digital modernization based on the mechanism of publicprivate partnership, while digitalization of the process of public-private partnership and its financing remains poorly studied.…”

Microfinance towards micro-enterprises development in rural Malaysia through digital finance

“…According to the Aisaiti et al [ 5 ], digital finance refers to new business models in the financial industry that are fueled by large artificial intelligence, datasets, cloud computing, and other cutting-edge technology. Microfinance's major objective is to expand consumer breadth, availability, and satisfaction of services in order to satisfy the growing financial needs of poors in the BOP market [ 23 ], including MEs, to acquire appropriate services at a reasonable interest rate in a simple, effective, and safe way [ 30 , 74 ].…”

“…One of the most widely held beliefs in the bottom of the pyramid (BOP) studies for decades has been that impoverished people would always have restricted access to financial services [ 10 ]. The BOP term referring to a segmenting the market in which clients have a yearly income of less than $1500 [ 5 ]. Prahalad [ 68 ] referred “people from BOP as successful customers”.…”

“…Successful BOP initiatives help MEs to develop more sustainably through microfinance services [ 71 ]. The adoption of digital finance within the BOP sector is the most serious impediment to the poor into long-term development [ 5 ]. Nevertheless, there is indeed a long-held assumption that MEs are resistant to financial technology adoption [ 27 ].…”

Current practices, new insights, and emerging trends of financial technologies

“…Employing financial technologies to improve financial inclusion is able to empower the rural farmers, local vendors and SMEs as well as to accelerate the economic growth of countryside. Aisaiti et al (2019) investigate China’s rural farmers financing intention of inclusive finance in the context of financial technology, and examine related drivers like knowledge of inclusive finance, perceived benefits and perceived risks of ordering finance. In their framework, the social enterprise embeddedness and digital finance were integrated into a conceptual model.…”