How Does Digital Financial Inclusion Affect Energy Usage? Evidence from Prefecture-Level Cities in China

Promoting the synergetic growth of the economy, energy, and environment is crucial in the context of China’s digital revolution. This research assesses the impact of digital financial inclusion on energy consumption, considering spatial dimensions and exploring the mechanisms involved in this relationship. The findings reveal the following: (1) As digital financial inclusion spreads, there is a decrease in energy use. This effect exhibits spatial spillover. (2) The depth of use dimension in digital financial inclusion significantly influences energy consumption. This influence is particularly notable in underdeveloped areas and cities with lower levels of innovation and entrepreneurship capacity. (3) Industrial agglomeration serves as a mechanism through which digital financial inclusion impacts energy consumption. Consequently, the development of digital financial inclusion should complement energy policies, providing increased support to underdeveloped regions while promoting the adjustment and transfer of industrial structure.