Development of Digital Finance and Commercial Banks’ Credit RiskEmpirical Evidence from 37 Listed Banks in China

Taking 37 listed banks in China from 2009 to 2019 as samples, in this paper, the impact of digital finance development on commercial banks’ credit risk was empirically tested. The main conclusions are as follows. Firstly, there is an inverted U-shaped relationship between the development of digital finance and commercial banks’ credit risk; the development level of digital finance has exceeded the inflection point, indicating that further development of digital finance is conducive to reducing credit risk of commercial banks. Secondly, the cost and structure of liabilities play an intermediary role in the inverted U-shaped relationship between the development of digital finance and commercial banks’ credit risk. Thirdly, the development of digital finance has no significant impact on the five major commercial banks’ credit risk, but the inverted U-shaped relationship is strong among the non-five major banks.