The power of technology: FinTech and corporate debt default risk in China

With the economic downward pressure increasing and the COVID-19 spreading, avoiding the corporate debt default risk is a basic requirement for achieving high-quality economic development in China. Can FinTech empower traditional finance and contribute to the healthy development? We explore the impact of FinTech on corporate debt default risk. The findings suggest that FinTech reduces the corporate debt default risk. And the impact is more pronounced in non-SOEs and in firms with small-scale and in the growth and maturity stages. Further analysis shows that financial supervision plays a role in strengthening the negative impact of FinTech on the corporate debt default risk. Therefore, FinTech development should be actively promoted and corresponding regulatory measures should be formulated, then the finance can better serve the real economy and achieve high-quality development in China.