The Impact of Digital Finance on the Development of Cross-Border E-Commerce

Abstract

Digital finance, a financial innovation paradigm driven by the synergy of digital technology and data elements, has significant advantages in enhancing the convenience, accessibility, and security of cross-border transactions. This study empirically examines the impact of digital finance on the development of cross-border e-commerce using provincial-level panel data from China between 2013 and 2023. After a series of robustness tests, the empirical results remained consistent and robust. The study found that digital finance significantly promotes the development of cross-border e-commerce. Further analysis indicated that digital finance enhances its supportive role in cross-border e-commerce by fostering the development of new, high-quality productive forces in the economy. The moderation effect analysis showed that internet penetration rates, innovation capital investment, and the development level of technology markets all have significant positive moderating effects on the role of digital finance in promoting cross-border e-commerce. The heterogeneity test results indicate that in regions with higher levels of marketization and a larger number of enterprises, the promotional effect of digital finance on cross-border e-commerce development is more pronounced.

1. Introduction

Cross-border e-commerce is a new model of foreign trade driven by technological innovation, which actively applies new technologies, adapts to new trends, and cultivates new momentum. It has become a vital force in the development of China’s foreign trade and an important trend in the development of international trade. In recent years, the Chinese government has provided strong policy support for the development of the cross-border e-commerce industry, providing a powerful impetus for the development of China’s foreign trade and economic recovery. In 2023, the total import and export value of China’s cross-border e-commerce reached 2.38 trillion yuan, an increase of 15.6% year-on-year; there were more than 100,000 market players and more than 690 industrial parks, and the service network covered more than 220 countries and regions around the world. The number of cross-border e-commerce consumers reached 189 million, up 13.17% year-on-year, and the penetration rate is steadily increasing, accounting for 40.35% of China’s total import and export value of trade in goods in 2023. In June 2024, the Ministry of Commerce and eight other departments jointly issued the “Guiding opinions on expanding cross-border e-commerce exports and promoting the construction of overseas warehouses,” proposing to vigorously support cross-border e-commerce in empowering industrial development, enhancing the ability to serve cross-border e-commerce enterprises, smoothing financing channels for cross-border e-commerce enterprises, optimizing cross-border capital settlement services, and promoting cost reduction and efficiency improvements in cross-border e-commerce supply chains, among other measures, to facilitate the healthy and sustainable development of new foreign trade models and formats. In November 2024, the Ministry of Commerce issued the “Several Policy Measures to Promote Stable Growth in Foreign Trade,” explicitly stating that efforts should continue to advance the construction of overseas smart logistics platforms and support eligible regions in exploring the development of cross-border e-commerce service platforms.

The global digital revolution is profoundly transforming modern society and economies. As the new round of technological revolution accelerates, the integration of digital technology with the real economy is deepening, making the development of digital finance to adapt to the digital economy an inevitable requirement for achieving high-quality socioeconomic development. Digital finance is a financial innovation driven by the dual engines of digital technology and data elements. It empowers traditional trade entities through digital technology, reshapes financial service models in traditional international trade, and achieves the digital transformation of investment, financing, and settlement processes. It will alleviate the problem of information asymmetry and the financing constraints of cross-border e-commerce enterprises, significantly improve the convenience of cross-border transactions, and enhance the convenience, accessibility and security of cross-border financial services. By the end of 2023, China’s non-bank payment institutions reached 183, with an annual number of transactions exceeding 1 trillion and a transaction value of nearly 400 trillion yuan, demonstrating its increasingly prominent strategic position in cross-border finance. In addition, China’s digital credit market grew at a compound annual growth rate of 125.1% from 2013 to 2019, and the digital finance market reached RMB 41.7 trillion in 2023, accounting for 15.6% of the global total and ranking first in the world. Digital finance is characterized by sharing, convenience, inclusiveness, and low cost [1]. The integration of digital finance and cross-border e-commerce has effectively reduced the search costs of cross-border e-commerce enterprises [2] and improved the efficiency and quality of these transactions [3]. However, because cross-border e-commerce companies are mainly small- and medium-sized enterprises, they generally lack sufficient capital, have multiple business links, complex participants, and long process chains. Consequently, digital finance still faces a series of challenges in supporting its development, such as security and privacy protection, data compliance, an incomplete legal regulatory system, and technical risks [4]. Enhancing the convenience of cross-border transactions and reducing cross-border risks in the process of promoting cross-border e-commerce transactions through digital finance are key to the current development of cross-border e-commerce driven by digital finance.

Previous studies on the impact of digital finance on the development of cross-border e-commerce have primarily focused on theoretical analyses, with systematic empirical research being relatively scarce. While existing studies have recognized the positive role of digital finance and cross-border e-commerce, few have empirically examined their interaction using long-term provincial-level data in China. Prior research often lacks analysis of internal mechanisms such as the development of new productive forces, and pays limited attention to moderating factors like internet penetration, innovation investment, and regional heterogeneity. To fill these gaps, this study used panel data from 2013 to 2023 to empirically test the impact of digital finance on cross-border e-commerce, explore underlying mechanisms, and identify key moderating and contextual factors. This provides both theoretical insights and practical guidance for promoting high-quality digital trade development.

Based on the provincial digital inclusive finance index and cross-border e-commerce development level indicators, this study conducted an empirical analysis and made the following contributions to the existing literature. First, this study not only verified the positive impact of digital finance on the development of cross-border e-commerce, but also explored its mechanism of action from the perspective of new quality productive forces, expanding the research paradigm of the impact of digital finance. Second, it introduced key variables such as the internet penetration rate, innovation capital investment, and technology markets to analyze their moderating effects on the process of digital finance influencing cross-border e-commerce development, thereby deepening the understanding of the relevant relationships and enriching the research dimensions. Third, it combined two heterogeneity dimensions—marketization level and number of enterprises—to analyze the differential impacts of digital finance on cross-border e-commerce development under different conditions, providing more targeted empirical evidence for policy formulation.

2. Literature Review

2.1. Research on Digital Finance

In recent years, academic research on digital inclusive finance has become increasingly rich, and the related literature can be broadly categorized into two main directions. The first type focuses on the key factors affecting the development of digital inclusive finance. Ghosh and Hom [5] examined how India’s demonetization policy spurred digital finance adoption. Anane and Nie [6] highlighted that in Ghana, the adoption of digital financial services is strongly influenced by infrastructure and transaction costs, underscoring the need to improve access and affordability to bridge socio-demographic gaps. Aloulou et al. [7] showed that in the United Arab Emirates’ (UAE), aligning FinTech with banking strategy during COVID-19 significantly boosted sector performance, reflecting strong national support for the digital financial transformation. The second category of research focuses primarily on the impact of digital inclusive finance. Related studies indicate that economic growth is largely dependent on the development of the financial system [8,9], and that financial development helps optimize the allocation of resources and capital and effectively reduce various types of risk [10]. In this context, digital finance plays a key role in enhancing financial inclusion [11,12,13]. Specifically, digital finance enhances economic growth by improving access to financial services and strengthening residents’ consumption and investment capabilities [14,15,16]. Other studies showed that digital finance improves access to finance [17,18], enhances the efficiency of the financial sector [19], and enhances the functioning of capital markets [20]. Lin and Ma [21] found that digital finance promotes green innovation in China by alleviating financing constraints. Ozili [22] emphasizes its growing global role in financial inclusion and efficiency while also pointing to regulatory and data-related risks as key areas for future research.

2.2. Research on Cross-Border E-Commerce

The significance of developing cross-border e-commerce lies in its capacity to enhance and optimize traditional foreign trade models. Traditional foreign trade is often hindered by indirect sales channels, which lead to challenges such as unclear buyer demand, protracted order cycles, and constrained profit margins. In contrast, cross-border e-commerce harnesses internet platforms to facilitate direct connections among businesses, wholesalers, retailers, and even end consumers. This approach not only broadens market reach, but also accelerates the flow of resources, thereby improving overall efficiency in trade. Yang [23] analyzed the key factors influencing the operation of cross-border e-commerce for small and medium-sized enterprises from four aspects: online marketing, online payments, customs declarations, and logistics. Cardona [24] emphasized that online transaction barriers significantly impact consumer behavior. The primary bottlenecks currently facing cross-border e-commerce are customs clearance and logistics. Kim et al. [25] found that the characteristics of small-batch, high-frequency, and low-unit-price orders result in low customs clearance efficiency, and recommended that the government implement relevant policies to provide support. Ma et al. [26] pointed out that China has already taken a leading position in the global cross-border e-commerce sector, with numerous platform-based enterprises emerging as key international players, and hundreds of thousands of small and medium-sized enterprises integrating into the international division of labor through digital platforms. Zhu et al. [27] further noted that digital technologies such as big data and cloud computing are continuously driving the upgrading of cross-border e-commerce, leading to the diversification of transaction partners, streamlined processes, and expanded scale. Cassia and Magno [28] investigated how IT, international marketing, and export operations capabilities influence the strategic and financial performance of SMEs’ cross-border e-commerce, revealing mixed effects and highlighting the moderating role of third-party platforms. Chen et al. [29] examined how differing capabilities among Taiwanese SMEs and micro-enterprises—such as marketing, product development, and cross-border potential—influence their selection of cross-border e-commerce platforms during global crises like COVID-19, highlighting key economic, social, technological, and legal considerations. Wen et al. [30] found that cross-border e-commerce pilot zones significantly enhance firms’ international competitiveness by boosting overseas revenue and total factor productivity, underscoring the role of digital trade in SME internationalization. Dallocchio et al. [31] analyzed how digital technologies affect cross-border e-commerce in Italian SMEs, revealing that e-marketing tools—especially social media and data tracking—significantly enhance online export performance, while marketplace presence outperforms proprietary websites in driving cross-border sales.

Chen et al. [32] examined how sellers’ network positions on cross-border e-commerce platforms influence their performance, highlighting the role of digital connectivity in empowering small businesses to access global markets. Xie et al. [33] propose a scalable two-stage framework for optimizing marketing resource allocation in cross-border e-commerce, combining predictive modeling with minimum-cost flow optimization to boost sales while meeting operational constraints. Zhang et al. [34] developed a Stackelberg game model to examine how blockchain adoption influences suppliers’ disclosure strategies and profits on e-commerce platforms, highlighting cost and reliability as key factors for platform-supplier alignment. Liu et al. [35] analyzed cross-border e-commerce reviews to uncover consumer concerns and sentiment trends, providing marketing insights grounded in 4P and 4C theories.

2.3. Research on the Relationship Between Digital Finance and Cross-Border E-Commerce

Recent studies underscore the intricate relationship between digital finance and the development of cross-border e-commerce, highlighting how technological and financial innovations jointly shape the dynamics of global trade. Zhong et al. [36] find that the establishment of China’s cross-border e-commerce pilot zones significantly stimulates economic growth—particularly in eastern coastal areas—by promoting urban digitalization, trade openness, and the agglomeration of information services. Complementing this, Ma [37] emphasized the role of emerging digital technologies in transforming cross-border e-commerce business models, enhancing user experience, digitalizing supply chains and strengthening global competitiveness. Focusing specifically on digital finance, Zheng [38] demonstrated that digital financial services significantly contribute to regional trade development in China, especially in the western regions, by improving access to e-commerce financing and fostering industrial upgrading. Similarly, Xu [39] highlighted how the integration of FinTech and supportive policies has reshaped cross-border e-commerce, with China providing a prominent example of how digital finance can enhance inclusivity and accessibility in global trade. There is also evidence that digital finance can support macroeconomic stability by enabling faster recovery from external trade shocks, as shown by Abendin and Duan [40]. On a broader scale, Derindağ [41] reviewed the evolution of cross-border e-commerce from 2010 to 2022, noting that digital technologies, strategic policies, and advanced payment systems have been central to its rapid growth, despite persistent structural and regulatory challenges. In line with this, Tan [42] examined China’s cross-border e-commerce payment systems under the dual circulation strategy, identified key inefficiencies, and offered strategic recommendations to improve transaction efficiency and integrate them into global digital trade networks. Collectively, these studies highlight the mutually reinforcing relationship between digital finance and cross-border e-commerce, where financial innovation not only enables trade expansion, but also supports economic resilience and structural transformation in the digital era.

3. Theoretical Analysis and Research Hypotheses

3.1. The Direct Mechanism of Digital Finance in Promoting Cross-Border E-Commerce Development

As global internet penetration increases and digital infrastructure continues to improve, the digital economy is rapidly expanding, contributing to the transformation of international trade. Among its manifestations, cross-border e-commerce has emerged as a vital new form of trade, integrating deeply into various sectors of the global economy. This growth has enabled consumers to bypass traditional trade intermediaries by purchasing goods directly from international sellers via online platforms, thereby reducing transaction costs, improving profitability for firms, and facilitating the transformation and upgrading of traditional foreign trade models. In China, the cross-border e-commerce sector has become a major driver of foreign trade growth, bolstering export expansion through advances in global branding, channel diversification, supply chain optimization, and marketing innovation.

Within this broader digital transformation, digital finance plays a distinct and pivotal role. While digitalization encompasses the application of digital technologies across various sectors—including logistics, marketing, and supply chain management—digital finance specifically refers to the application of digital technologies within the financial sector to improve the accessibility, efficiency, and inclusivity of financial services [43]. Technologies such as big data, cloud computing, blockchain, and artificial intelligence are used not merely to digitize existing financial services, but to reconfigure how financial resources are allocated, how risks are assessed, and how financing needs are met, especially for cross-border e-commerce enterprises. Digital finance has the potential to simultaneously drive innovation and enhance the quality of financial products, business processes, and operational models. It facilitates the optimal allocation of international financial resources and effectively mitigates information asymmetry and financing constraints that often hinder cross-border e-commerce enterprises. Furthermore, it significantly improves the convenience of cross-border transactions, supports comprehensive structural reforms on the financial supply side, and enhances the convenience, accessibility, and security of cross-border financial services. Specifically, digital finance leverages digital technology to conduct an in-depth analysis of industry trends and corporate development cycles, thereby enhancing resource allocation efficiency and directing financial resources toward high-quality cross-border e-commerce enterprises [4].

First, digital finance effectively overcomes temporal and spatial limitations through decentralized platforms, enabling efficient alignment between the financing requirements of cross-border e-commerce and available financial resources. This innovation serves to reduce transaction costs and mitigate market risks. Additionally, digital finance facilitates the reallocation of resources toward more efficient and market-oriented enterprises, thereby addressing issues such as ownership mismatches and inadequate service coverage prevalent in traditional financial systems. It offers enhanced and cost-efficient financial support to early-stage, technology-driven cross-border e-commerce enterprises, consequently alleviating the sectoral disparities commonly associated with financial services.

Second, digital finance is essential in mitigating cross-border information asymmetry. While online transactions in cross-border e-commerce enhance convenience, they also introduce risks, including regulatory gaps and transparency issues. Although enterprises have a clearer understanding of their financial needs, financial institutions often struggle to fully comprehend these requirements, which exacerbates information asymmetry. Blockchain technology significantly enhances transaction transparency and authenticity. By integrating logistics, capital flows, and information flows, it enables real-time monitoring of trade processes. Additionally, it supports intelligent evaluations of transaction backgrounds and employs distributed ledgers to ensure data authenticity and immutability. The use of smart contracts allows for automatic rule execution, thereby improving transaction security and efficiency. Moreover, digital finance utilizes big data and artificial intelligence to analyze corporate transaction networks and operational conditions. This equips financial institutions with data-driven decision-making criteria for investments and financing, bridging the knowledge gap with cross-border e-commerce enterprises. In an interconnected global landscape, embracing digital finance is crucial for enhancing transparency and achieving success in international trade.

Third, digital finance significantly mitigates financing constraints in cross-border e-commerce by expanding financing channels, lowering borrowing costs, and reducing information asymmetry. Most cross-border e-commerce enterprises are small- and medium-sized enterprises (SMEs) that often struggle with fragmented critical information—such as cash flow, trade flow, and regulatory data—due to limited scale and lack of standardized management practices. By utilizing big data and cloud computing, digital finance provides accessible, low-threshold financial services that enhance inclusivity and improve the efficiency of resource access. Additionally, the implementation of blockchain and smart contracts offers secure, efficient cross-border payment solutions, overcoming the challenges associated with traditional bank transfers and credit card payments, which are often costly and slow. The use of third-party payment tools allows for quicker settlements, thereby reducing transaction costs and financial risks.

Finally, digital finance has significantly improved the convenience of cross-border services. Traditional cross-border financing is often hindered by cumbersome procedures, time delays, and exchange rate fluctuations. In contrast, digital finance uses electronic payment systems and virtual currencies to offer e-commerce enterprises more efficient payment and financing options. Firstly, it incorporates third-party payment methods, expanding payment channels and allowing consumers to transact using credit cards, e-wallets, mobile payments, and cryptocurrencies, thereby reducing transaction times and enhancing efficiency. Secondly, digital technology enables businesses to manage multi-currency accounts globally, facilitating centralized fund management and real-time allocation, which improves fund utilization. Lastly, intelligent customs systems automatically calculate and declare taxes and duties, streamlining compliance, accelerating customs clearance, and minimizing logistics delays.

Hypothesis 1 (H1).

Digital finance can promote the development of cross-border e-commerce.

3.2. The Indirect Mechanism of Digital Finance in Promoting Cross-Border E-Commerce Development

Digital finance is a modern financial activity that employs technologies such as big data, artificial intelligence, and blockchain. While it integrates these advanced tools, its foundational attributes and core functions remain unchanged, focusing primarily on serving the real economy and driving economic growth. This evolution has accelerated the digital transformation of financial institutions and improved the intelligence and personalization of financial services, enhancing customer experience and operational efficiency. The proposal of new quality productive forces is based on the needs of China’s current economic development practices. Its formation is a process of quantitative accumulation, and when its development breaks through the stable critical point of traditional productive forces, the old productive force structure will be broken, and new quality productive forces will gain a dominant position [44]. New quality productive forces represent the advanced production development level led by scientific and technological innovation is related to the quality of the overall economy, finance as the core of the modern economic system, digital finance is a new form of finance in the current development, represented by the new financial industry to speed up the speed of capital turnover, reduce transaction costs, and profoundly change the mode of operation of the modern economy. As an important driving force for economic transformation and development at this stage, digital finance has a significant role in promoting the development of new quality productive forces [45].

New quality productive forces have emerged from traditional productive forces; however, the fundamental components of the productive force system—labor, objects of labor, and means of labor—remain largely unchanged and can still be understood through a traditional framework. Digital finance is instrumental at the worker level, as it lowers barriers to financial access, expands educational and skills development opportunities, and supports the growth of new productive forces. Workers can use digital finance platforms to manage personal assets, engage in investments, enhance capital liquidity, and stimulate financial market activity. For enterprises, digital finance provides diverse financing channels and credit support, fosters technology adoption, promotes infrastructure modernization, and enhances production efficiency. It also aids in optimizing financial structures, ensuring rational allocation of resources, and improving overall resource utilization. Additionally, digital finance utilizes advanced information technology to help businesses analyze market conditions, understand consumer demand, develop aligned products and services, and promote new consumption models such as e-commerce and online payments, thus expanding market opportunities. Overall, digital finance is increasingly becoming a key force in promoting the development of new quality productive forces. With the continuous deepening of its technology and application, its role in promoting new quality productive forces will become increasingly significant [45].

The rapid expansion of cross-border e-commerce has transformed traditional trade models and created new opportunities for economic advancement in various nations. High-quality productive forces significantly contribute to economic growth and industrial transformation by optimizing service processes and management systems, thereby enhancing efficiency and resource utilization. By utilizing advanced technology and modern management practices, cross-border e-commerce enterprises can improve their market adaptability and service quality. For example, the integration of smart devices and information systems allows for the automation of service processes, leading to greater efficiency, cost reduction, and enhanced service delivery. Additionally, the enhancement of high-quality productive forces accelerates innovation, promotes business model transformation, and strengthens market competitiveness. Industrial upgrading, and research and development (R&D) innovation are vital for economic growth, propelling industries toward high-value-added markets through technological advancements and strategic management improvements while providing a continuous momentum for enterprise development through ongoing innovation.

In the context of economic globalization and digitalization, industrial upgrading and R&D innovation have become key paths for cross-border e-commerce enterprises to achieve sustainable development. By improving service quality, reducing costs, and enhancing competitiveness, cross-border e-commerce enterprises can better adapt to market changes and achieve intensive development. Based on this, this study discusses the impact mechanism of digital finance on the development of cross-border e-commerce from an empirical perspective and introduces new quality productive forces as an intermediate variable, with the aim of providing references and inspiration for policy-making, enterprise practice, and academic research to promote the healthy development of the industry. As a new mode of production centered on flexibility, innovation, and informatization, new quality productive forces have a profound impact on the development of cross-border e-commerce. On the one hand, it is people-oriented and emphasizes personalized and flexible production, which is highly compatible with the characteristics of cross-border e-commerce that must cope with cultural differences and diversified consumer demand. On the other hand, new quality productive forces emphasize continuous innovation, which helps cross-border e-commerce attract global consumers and achieve business growth through the continuous iteration of service and marketing models. In addition, the in-depth application of information technology is also in line with the Internet and big data-dependent operating model of cross-border e-commerce, which can further improve operational efficiency and market competition. In summary, new quality productive forces directly promote the development of cross-border e-commerce and help the industry continue to grow by improving enterprise flexibility, promoting innovation, and strengthening information technology applications.

Hypothesis 2 (H2).

Digital finance can indirectly promote the development of cross-border e-commerce by improving new quality productive forces.

4. Research Design

4.1. Variable Definitions

4.1.1. Explained Variable

Cross-border e-commerce development level (Cbe). Drawing on the research findings of the existing literature [46,47], this study constructed a comprehensive evaluation index system for cross-border e-commerce development levels from three dimensions: scale index, support index, and potential index. The comprehensive index was calculated using the TOPSIS entropy weight method. The box plots and kernel density maps of cross-border e-commerce development level are shown in Figure 1.

4.1.2. Core Explanatory Variable

Digital finance (Dfi). The “Peking University Digital Inclusive Finance Index,” jointly compiled by the Peking University Digital Finance Research Center and Ant Financial Group, is the most frequently used and authoritative indicator in digital finance-related studies. The Digital Inclusive Finance Index comprehensively and objectively measures the development of digital inclusive finance across China’s provincial, municipal, and county-level administrative regions. The selection of indicators is scientific and reasonable, and the index has been widely adopted by scholars in academic research [38]. Therefore, this study uses the Peking University Digital Inclusive Finance Index to measure the level of digital finance development and examine its impact of digital finance on the development of cross-border e-commerce. The box plots and kernel density maps of digital finance are shown in Figure 2.

4.1.3. Mediator Variable

New quality productive forces (NQPF). Referring to the existing literature [48], we constructed an evaluation index system for the development level of new quality productive forces based on qualitative changes in workers, means of labor, objects of labor, and their optimal combination. We then used the entropy method to determine the weight of each indicator level and calculated the new quality productive forces development index for each province from 2013 to 2023.

4.1.4. Regulatory Variables

Referring to the existing literature [43,45], this study selected the following variables as moderating variables: (1) internet penetration rate (Ipr) to analyze its moderating effect on the influence of digital finance on the development level of cross-border e-commerce; (2) innovation capital investment (Ici), measured by the ratio of R&D expenditure to regional GDP; and (3) technology market development level (Tech), measured by the ratio of technology market transaction volume to regional GDP, reflecting the level of activity in a region’s technology market.

4.1.5. Control Variables

To avoid endogeneity issues caused by omitted variables, we referred to previous studies [45] and selected control variables that may influence the development of cross-border e-commerce. These included the following: (1) urbanization (Urb): urbanization rate was used to measure the level of regional economic development. The level of economic development in a region is a key factor in improving the development of cross-border e-commerce. The better the economic development level, the more conducive it is to the development of cross-border e-commerce. Other control variables included the following: (2) economic development (Gdp): Gross Domestic Product (GDP); (3) degree of openness (Open), measured by the ratio of the product of total goods imports and exports and the USD-to-RMB exchange rate to the regional GDP; (4) industrial structure (Ind): the ratio of tertiary industry value added to secondary industry value added; (5) human capital (Labor), measured by the ratio of the number of students enrolled in higher education institutions to the total population; (6) industrial aggregation (Ial), which is the ratio of the number of employed persons to the administrative area of the region; and (7) government intervention (Gov), measured by the ratio of local government general budget expenditures to regional GDP.

The specific variable types, names, symbols, and their meanings are listed in

Table 1. Summary of the main notations.

Variable Type	Variable Name	Variable Symbol	Variable Meaning
Explained variable	Cross-border E-commerce development	Cbe	Entropy weighting method calculation
Core explanatory variable	Digital finance	Dfi	Entropy value calculation method
Mediating variable	New quality productive forces	NQPF	Entropy value calculation method
Regulatory variable	Internet penetration rate	Ipr	Number of Internet broadband access users/Total permanent population
	Innovative capital investment	Ici	Internal expenditure on R&D/GDP
	Technology market	Tech	Technology market transaction volume/regional gross domestic product
Control variables	Urbanization	Urb	Urbanization rate
	Economic development	Gdp	Regional gross domestic product
	Degree of openness	Open	(Total import and export of goods × US dollar to RMB exchange rate)/Regional Gdp
	Industrial structure	Ind	Value added of tertiary industry/value added of secondary industry
	Human capital	Labor	Number of students enrolled in higher education institutions/total population
	Industrial agglomeration	Ial	Number of employed persons/administrative area
	Government intervention	Gov	Fiscal expenditure/regional GDP

.

4.2. Model Settings

Based on the theoretical logic discussed above, the econometric model was set as follows:

$$Cb{e}_{it}=\alpha +{\alpha }_{1}Df{i}_{it}+{\alpha }_2{Z}_{it}+{\delta }_i+{\theta }_t+{\epsilon }_{it}$$

(1)

In this case, the subscript i represents the province, and t represents the year. $Ce{b}_{it}$ represents cross-border e-commerce development, which is an indicator used to measure the level of cross-border e-commerce development. $Df{i}_{it}$ represents the level of digital finance development in region i in year t. $Z_{it}$ is the control variable, ${\delta }_i$ is the province fixed effect term, ${\theta }_t$ is the time fixed effect term, and ${\epsilon }_{it}$ is the random error term, assuming that they all satisfy the conditions of independence and identical distribution.

4.3. Descriptive Statistics of Variables

Given the availability of data, panel data from 31 provinces in China (excluding Hong Kong, Macao, and Taiwan) from 2013 to 2023 were selected for the study. The original data primarily come from the “Peking University Digital Financial Inclusion Index, China Statistical Yearbook, China Foreign Investment Statistical Bulletin, China Science and Technology Statistical Yearbook, China Energy Statistical Yearbook, China Industrial Statistical Yearbook, China Environmental Statistical Yearbook, Postal Administration Bureau, Ministry of Commerce, National Bureau of Statistics, and the China Internet Network Information Center. Missing data were imputed using interpolation.

Table 2. Definition of the variables.

Variable Type	Variables	Observation	Mean	Median	Standard Deviation	Minimum Value	Maximum Value
Explained variable	Cbe	301	279	283	81.20	115	464
Core explanatory variable	Dfi	301	8.660	4.800	10.80	0.761	82.40
Mediating variable	NQPF	301	0.283	0.253	0.134	0.0718	0.747
Regulatory variable	Ipr	301	0.265	0.259	0.108	0.0603	0.523
	Ici	301	1.830	1.560	1.230	0.189	6.840
	Tech	301	0.0199	0.00822	0.0324	2.58 × 10−5	0.195
Control variables	Urb	301	0.605	0.594	0.126	0.239	0.896
	Gdp	301	12,980	9945	8607	5692	49,352
	Open	301	0.258	0.143	0.260	0.00763	1.260
	Ind	301	1.440	1.270	0.792	0.665	5.690
	Labor	301	21.20	20.80	5.980	8.880	43.60
	Ial	301	25.90	15.30	39.20	0.146	217
	Gov	301	0.279	0.226	0.195	0.107	1.330

presents the descriptive statistics for the specific variables.

5. Empirical Results and Analysis

5.1. Benchmark Regression Analysis

Table 3. Benchmark regression results.

Variable	(1)	(2)
	Cbe	Cbe
Dfi	0.234 *** (7.43)	0.243 *** (7.41)
Urb		−23.103 (−1.13)
Gdp		−0.001 *** (−2.65)
Open		−8.440 * (−1.83)
Ind		0.975 (0.59)
Labor		−0.263 (−1.41)
Ial		1.213 *** (6.28)
Gov		6.965 (0.89)
Constant	−56.604 *** (−6.45)	−64.621 *** (−4.01)
Year fixed effect	Yes	Yes
Province fixed effect	Yes	Yes
N	300	300
R2	0.906	0.927

Note: * and *** indicate significance at the 10%, 5%, and 1% levels, respectively. The values in parentheses are t-values.

presents the benchmark regression results for data finance on the development of cross-border e-commerce. Column (1) shows the results without the control variables, and column (2) shows the results after including all the control variables. Both columns have fixed effects for the year and province. As shown in Table 3, regardless of whether the control variables are included in the model, data finance significantly promotes the development of cross-border e-commerce at the 1% level and is therefore robust. After controlling for other variables that may influence the dependent variable, the effect of data finance on the dependent variable became even more significant. Additionally, the improvement in R² indicates that the model’s fit has been enhanced, and the explanatory power of data finance and other variables on the dependent variable has been strengthened, thereby validating H1.

5.2. Stability Testing Analysis

5.2.1. Replacing Explanatory Variables

To test the robustness of the core conclusions and mitigate potential sample selection bias in data processing, this study followed Chen [49] and replaced the explanatory variables. Specifically, the explanatory variables were replaced with “depth (Depth)” and “digitalization level (Digit)” to conduct benchmark regression. The results are presented in columns (1) and (2) of

Table 4. Analysis of the results of the robustness test and endogeneity test.

Variable	(1)	(2)	(3)	(4)	(5)	(6)	(7)	(8)
	Replaced Explanatory Variable Depth	Replaced Explanatory Variable Digit	Exclude Year	Excluding Municipalities	Replaced Regression Model FE	Tailing Method	Instrumental Variable Method	System GMM
	Cbe	Cbe	Cbe	Cbe	Cbe	Cbe	Cbe	Cbe
L. Ceb								1.119 *** (45.62)
Dfi			0.244 *** (6.89)	0.307 *** (8.71)	0.243 *** (7.41)	0.203 *** (8.59)	0.497 *** (7.97)	0.003 * (1.87)
Depth	0.121 *** (6.36)
Digit		0.067 *** (5.40)
Control variables	Yes	Yes	Yes	Yes	Yes	Yes	Yes	Yes
Constant	−42.232 *** (−2.75)	−29.724 * (−1.97)	−62.037 *** (−3.73)	−32.652 * (−1.90)	−40.549 *** (−3.12)	−62.762 *** (−5.31)	−36.313 *** (−2.60)	0.137 (0.09)
Year fixed effect	Yes	Yes	Yes	Yes	Yes	Yes	Yes	Yes
Province fixed effect	Yes	Yes	Yes	Yes	Yes	Yes	Yes	Yes
N	300	300	270	260	301	300	290	271
R2	0.923	0.920	0.923	0.941	0.645	0.954	0.915

Note: * and *** indicate significance at the 10%, 5%, and 1% levels, respectively. The values in parentheses are t-values.

. The findings indicate that digital finance significantly promotes the improvement of cross-border e-commerce development levels.

5.2.2. Excluding the Year

Following Chen et al. [44], considering the impact of the COVID-19 pandemic on China’s economic and financial development in 2020, the 2020 sample was excluded, and the regression was re-run. The results are presented in Table 4, column (3). The regression coefficient of the explanatory variable “digital finance” remained significantly positive, thereby further confirming the robustness of the previous conclusions.

5.2.3. Replacing the Regression Model FE (Fixed Effects Model)

From the perspective of the origin of the samples, the four municipalities of Beijing, Tianjin, Shanghai, and Chongqing, as regions with strong economic strength in China, enjoy more obvious policy advantages than the other regions. This study removed the four municipalities from the original sample and recalculated the regression results. As shown in Table 4, column (4), even after excluding the sample data from the municipalities, digital finance significantly drives the development of cross-border e-commerce.

5.2.4. Excluding Municipalities

To verify the robustness of the benchmark regression results, we adjusted the fixed effects model settings to test whether the impact of digital finance on cross-border e-commerce development remained consistent, thereby ruling out potential biases caused by omitted variables or model mis-specification. The results are presented in Table 4, column (5). Digital finance passed the 1% significance level test, indicating that the benchmark regression results were not due to specific fixed effects model setting biases, further supporting the robustness of the research hypothesis H1.

5.2.5. Tail Trimming

Considering that outliers may affect the results of empirical tests, this study trimmed the top and bottom 1% of all variables. The results are presented in Table 4, column (6). The results indicate that digital finance passes the 1% significance level test, confirming the robustness of the benchmark regression results.

5.3. Endogeneity Test Analysis

5.3.1. Instrumental Variable Method

The instrumental variable method was used to treat endogeneity and alleviate the endogeneity problem caused by omitted variables. Referring to the approach of Chen et al. [45], the spherical distance between each provincial capital city and Hangzhou was selected as the instrumental variable to identify the causal relationship between digital finance and new quality productive forces. In the specific construction process, this study used a fixed-effects model and introduced the interaction term between the above spherical distance and the lagged digital finance index as the instrumental variable into the model. A two-stage least-squares regression was conducted for the instrumental variables, primarily because Hangzhou holds significant symbolic importance in the field of internet finance, and theoretically, this distance has no direct correlation with other variables.

The results of the first-stage regression show that the spherical distance between each provincial capital and Hangzhou, and the interaction term between the lagged digital finance index and the spherical distance have a significant negative impact on the digital finance index. This indicates that Hangzhou, as the central city of China’s internet finance industry, has a higher level of digital finance development the closer a province is to it. Column (7) of Table 4 reports the results of the second-stage regression using instrumental variables for digital finance. The two-stage regression coefficient for the impact of digital finance on cross-border e-commerce development is 0.497, which is significant at the 1% level, indicating that digital finance can promote cross-border e-commerce development. The critical value is 23.57, which passes the weak instrumental variable test. In summary, this indicates that the instrumental variables selected in this study are reasonable, and the regression results further validate H1.

5.3.2. System GMM

To address potential endogeneity concerns in our empirical model, we employed the System Generalized Method of Moments (System GMM) estimator. The estimation results are presented in column (8) of Table 4. The coefficient of the lagged dependent variable (L. Ceb) is positive and highly significant, suggesting strong path dependence and persistence in cross-border e-commerce business (Ceb). The coefficient of Dfi is positive and significant at the 10% level, suggesting that digital financial inclusion exerts a positive influence on cross-border trade logistics. Overall, the System GMM results confirm the robustness of our main findings. Digital financial inclusion significantly contributes to the advancement of cross-border trade logistics, and the regression results provide further support for H1.

The results are presented in Table 4.

5.4. Mechanism Effect Test Analysis

New quality productivity forces (NQPF). Drawing on the existing literature [48], this study constructs an evaluation index system for the development level of new quality productivity, with its core essence being the qualitative transformation of workers, means of production, objects of labor, and their optimized combination. The entropy method was employed to determine the weights of indicators at each level, and the new quality productivity development index for each province is calculated for 2013 to 2023. Based on this, this study constructed the following mediation effect model to verify the impact path of new quality productive forces:

$$NQP{F}_{it}=\beta +{\beta }_{1}Df{i}_{it}+{\beta }_2{Z}_{it}+{\delta }_i+{\theta }_t+{\epsilon }_{it}$$

(2)

$$Cb{e}_{it}=\gamma +{\gamma }_{1}Df{i}_{it}+{\gamma }_{2}NQP{F}_{it}+{\gamma }_3{Z}_{it}+{\delta }_i+{\theta }_t+{\epsilon }_{it}$$

(3)

The results of the mediation effect model with “new quality productive forces” as the mediating variable are presented in

Table 5. Analysis of the mechanism effect results.

Variable	(1)	(2)
	NQPF	Cbe
Dfi	0.001 *** (3.00)	0.231 *** (6.98)
NQPF		14.642 * (1.83)
Control variables	Yes	Yes
NQPF		14.642 * (1.83)
Constant	−0.145 (−1.15)	−62.494 *** (−3.88)
Year fixed effect	Yes	Yes
Province fixed effect	Yes	Yes
N	300	300
R2	0.970	0.928

Note: * and *** indicate significance at the 10%, 5%, and 1% levels, respectively, with t-values in parentheses.

. In column (1), the regression coefficient of digital finance on new quality productive forces is significantly positive at the 1% level, indicating that the introduction and application of digital finance effectively promote the development of cross-border e-commerce. In column (2), the regression coefficients of digital finance and new quality productive forces are both significantly positive at the 1% level, indicating that digital finance not only has a direct positive impact on the development of cross-border e-commerce but also indirectly affects the development of cross-border e-commerce through the mediating variable of new quality productive forces. Specifically, digital finance relies on digital technology to promote technological innovation and production efficiency in enterprises and accelerate the improvement of social science and technology levels, injecting strong momentum into the “new” breakthroughs in new quality productive forces. New quality productive forces can not only enhance economic competitiveness, but also promote the optimization and upgrading of economic structures. Through the introduction of advanced technology, intelligent manufacturing, and digital production, new quality productive forces inject new vitality and momentum into cross-border e-commerce, thereby promoting its growth.

5.5. Moderation Effect Analysis

We further investigated whether the internet penetration rate (Ipr), innovation capital investment (Ici), and technology market development level (Tech) have a moderating effect on the impact mechanism of digital finance on the development of cross-border e-commerce.

5.5.1. Internet Penetration Rate

The results of the moderation effect model with the “internet penetration rate” as the moderator variable are shown in

Table 6. Analysis of the moderating effects.

Variable	(1) Ipr	(2) Ici	(3) Tech
	Cbe	Cbe	Cbe
Dfi	0.112 ** (2.59)	0.162 *** (4.69)	0.204 *** (6.09)
D_I	0.195 *** (4.02)
Ipr	−106.817 *** (−5.92)
D_C		0.009 *** (2.71)
Ici		4.238 ** (2.53)
D_T			−0.429 *** (−3.72)
Tech			256.187 *** (4.52)
Control variables	Yes	Yes	Yes
Constant	−50.643 *** (−3.30)	−43.447 *** (−2.62)	−51.434 *** (−3.17)
Year fixed effect	Yes	Yes	Yes
Province fixed effect	Yes	Yes	Yes
N	300	300	300
R2	0.937	0.938	0.932

Note: ** and *** indicate significance at the 10%, 5%, and 1% levels, respectively, with t-values in parentheses.

, column (1). The regression coefficient for digital finance is significantly positive at the 1% level, indicating that internet penetration rate plays a positive moderating role in promoting the development of cross-border e-commerce through digital finance. Specifically, when the internet penetration rate is high, it facilitates smooth data flow, reduces the costs and risks of data transactions, and enables digital finance to provide more convenient and efficient information exchange services. Second, the internet provides a platform for services such as data storage and analysis, enabling the identification of cross-border e-commerce enterprises with high growth potential and quality, thereby increasing financial support for their technological innovation and further promoting cross-border e-commerce development. Finally, the continuous upgrading and development of the internet can strengthen the interconnectivity among cross-border e-commerce enterprises, effectively integrate various resources along the cross-border e-commerce supply chain, and optimize the allocation of production factors across the entire supply chain, thereby facilitating the promotional role of digital finance in cross-border e-commerce.

5.5.2. Innovative Capital Investment

The results of the moderation effect model with “innovation capital investment” as the moderating variable are shown in Table 6, column (1). The regression coefficient for digital finance is significantly positive at the 1% level, indicating that innovation capital investment plays a positive moderating role in promoting the development of cross-border e-commerce via digital finance. Innovation capital investment has a positive impact on economic growth, significantly promoting high-quality economic development, driving the improvement of economic digitalization levels, and accelerating corporate technological innovation. Furthermore, the innovative capabilities and technological strength of cross-border e-commerce enterprises are important factors influencing their competitiveness. In a rapidly changing economic environment, cross-border e-commerce enterprises increase innovation capital investment, introduce advanced technologies, and enhance product quality and service levels to address competitive challenges and maintain competitive advantages, thereby further promoting cross-border e-commerce development.

5.5.3. Technology Market

The results of the moderation effect model with “technology market” as the moderating variable are shown in Table 6, column (3). The regression coefficient for digital finance is significantly positive at the 1% level, indicating that the technology market plays a positive moderating role in promoting the development of cross-border e-commerce through digital financial investment. Specifically, as a key platform for transforming R&D outcomes into practical applications, a higher level of technology market development can provide the necessary market environment for cross-border e-commerce innovation, making the impact of financialization on the quality of innovation in cross-border e-commerce enterprises more significant. Secondly, the development of the technology market often comes with “structural dividends,” providing conditions for the rational allocation of innovation resources, enhancing technological innovation, and supplying technical talent to cross-border e-commerce enterprises, thereby stimulating their innovation vitality to a certain extent, thereby supporting cross-border e-commerce enterprise innovation.

5.6. Heterogeneity Analysis

5.6.1. Degree of Marketization

The degree of marketization (Emi) was measured using the marketization index [50], and the heterogeneity analysis was conducted based on the degree of marketization. The impact of digital finance on the development of cross-border e-commerce in regions with different degrees of marketization may also be heterogeneous. The average value of marketization was used as the classification criterion. Regions above this value are defined as high-marketization regions, and those below are defined as low-marketization regions. A heterogeneity analysis of marketization was conducted based on this classification criterion.

Table 7. Analysis of the heterogeneity test results.

Variable	(1)	(2)
	Cbe	Cbe
	High Emi	Low Emi
Dfi	0.206 *** (3.16)	0.002 (0.21)
Control variables	Yes	Yes
Constant	−83.234 ** (−2.54)	−1.779 (−0.48)
Year fixed effect	Yes	Yes
Province fixed effect	Yes	Yes
N	166	132
R2	0.935	0.958

Note: ** and *** indicate significance at the 10%, 5%, and 1% levels, respectively, with t-values in parentheses.

columns (1) and (2) report the results of the impact of digital finance on cross-border e-commerce development in regions with different levels of marketization. In regions with high marketization, the promotional effect of digital finance on cross-border e-commerce development is significantly positive at the 1% level, and the promotional effect is higher than the average level at the provincial level. This indicates that a well-functioning marketization mechanism has a significant promotional effect on digital finance, driving the development of cross-border e-commerce. In regions with lower levels of marketization, the impact of digital finance on cross-border e-commerce development is not significant. This may be due to the fact that regions with lower levels of marketization have lower resource allocation efficiency and incomplete market mechanisms, making it difficult for the advantages of digital finance in information transmission, risk control, and capital matching to be converted into actual effectiveness. Additionally, regions with low marketization levels face institutional barriers, such as insufficient policy support and inadequate financial market assistance. These institutional bottlenecks exert a significant inhibitory effect on the transmission pathways through which digital finance promotes the development of cross-border e-commerce.

5.6.2. Number of Enterprises

Referring to the research of [45], the number of enterprises (Firm) was measured using the number of large-scale industrial enterprises in the region. This study categorized the number of large-scale industrial enterprises at the provincial level into two categories—high and low enterprise densities —based on the median value of the 2023 data. The regression results in columns (5) and (6) of Table 7 show that the higher the enterprise density, the higher the degree of enterprise agglomeration, and the better the effect of digital finance in promoting the development of cross-border e-commerce. Conversely, a lower enterprise density indicates lower enterprise agglomeration, with enterprises distributed more sparsely and lacking scaled synergies. Digital financial services struggle to achieve economies of scale, while lagging digital financial infrastructure development and low financial service penetration rates within the region further weaken their effectiveness in promoting the development of cross-border e-commerce.

6. Conclusions

The findings of this study demonstrate that digital finance plays a significant role in advancing the development of cross-border e-commerce. The conclusions remain robust even after conducting multiple tests for reliability, including an endogenous treatment analysis. Additionally, the results from the mechanism analysis indicated that enhancing the level of new quality productive forces serves as a crucial pathway through which digital finance facilitates the growth of cross-border e-commerce. Furthermore, the moderation analysis identified that factors such as the internet penetration rate, investment in innovative capital, and the technology market exert positive moderating effects on the relationship between digital finance and the advancement of cross-border e-commerce. Moreover, heterogeneity analysis revealed that the impact of digital finance on cross-border e-commerce development differs according to varying levels of marketization and the number of enterprises in a given context. Specifically, the effect of digital finance is pronounced in highly marketized environments when compared to those exhibiting lower levels of marketization. Similarly, in settings characterized by a higher number of enterprises, digital finance demonstrates a greater enhancing effect on the development of cross-border e-commerce businesses than in those with fewer enterprises.

Based on the above conclusions, the following recommendations are proposed.

First, to enhance the potential of cross-border e-commerce, it is imperative to strengthen the digital financial infrastructure. A primary objective should be to improve productive forces and establish a coordinated development framework that integrates digital finance with e-commerce initiatives. Increased investment in technologies such as blockchain, big data, and artificial intelligence is essential to foster technological innovation and facilitate industrial upgrading. Furthermore, it is vital to strengthen collaboration among industry, academia, and research institutions to create an effective innovation support mechanism. Key strategies should include product innovation, the reduction in financing costs, and the enhancement of capital turnover efficiency. By prioritizing technological advancement and talent acquisition, organizations can bolster digitalization efforts and improve international competitiveness. Promoting the flow of capital toward high-quality productive forces will establish a deeper synergy between digital finance and cross-border e-commerce. Through the joint efforts of government entities, financial institutions, and enterprises, it is possible to construct an efficient digital financial ecosystem. This partnership will empower the advancement of cross-border e-commerce while simultaneously promoting the coordinated development of both digital finance and e-commerce sectors.

Second, to enhance the regulatory impact of internet penetration, innovation capital investment, and the technology market on digital finance and cross-border e-commerce, it is essential to optimize the environment from various perspectives. Increasing investment in internet infrastructure in rural and remote areas will improve coverage and expand access to digital financial services. In terms of innovation capital, policies like tax incentives and fiscal subsidies can effectively guide research and development investments, while enhancing market allocation mechanisms to improve capital efficiency. Strengthening intellectual property protection, standardizing transaction processes, establishing efficient matching platforms, and promoting the commercialization of technological advancements are also crucial for technology market development. By optimizing these regulatory factors, stakeholders can promote the synergistic development of digital finance and cross-border e-commerce.

Third, the impact of digital finance on cross-border e-commerce varies by marketization levels and the number of enterprises in a region, necessitating a differentiated supervisory approach by regulatory authorities. In regions with high marketization, it is crucial to create a fair environment that supports enterprise internationalization through digital finance. Conversely, in regions with low marketization, efforts should focus on enhancing market mechanisms, increasing policy support, and addressing development gaps. Regions with a high concentration of businesses should promote collaborative development to leverage industrial clusters, while those with fewer enterprises need to implement policy guidance and financial incentives to attract new businesses and stimulate market vitality.

The findings of this study provide significant implications for policymakers in the Chinese government. Digital finance plays a crucial role in advancing cross-border e-commerce by enhancing productivity, influenced by factors such as internet penetration and innovation capital. Policymakers should formulate targeted strategies to strengthen these critical areas. For example, the government should prioritize inclusive digital financial policies that support small and medium-sized enterprises involved in cross-border trade. Additionally, the varying impacts based on marketization levels and enterprise concentration necessitate region-specific financial and industrial policies. In highly marketized regions, regulatory frameworks must promote fair competition and international expansion, while less developed areas require proactive financial inclusion initiatives and capacity-building programs. These insights are vital for guiding future policy decisions aimed at creating a resilient and inclusive digital economy, in line with national strategies like “Digital China” and the “Belt and Road Initiative.”