Author(s)

Yuyue Luo

Corresponding Author

Yuyue Luo

Abstract

For a long time, there has been an imbalance in rural credit supply in China. Meanwhile, due to the limited education level in rural areas, peasant households have a strong resistance to the financial industry, which restricts the development of inclusive finance. This paper argues that the average educational year in rural areas will affect the development of rural inclusive finance from the aspects of learning ability of financial knowledge, acceptance capability of financial products, the demand preference of inclusive finance and the repayment ability of credit finance. Based on a fixed effect model, the empirical studies in this paper shows that the average educational year in rural areas have a significant effect on promoting rural inclusive finance, and this effect may have non-linear effects of increasing marginal effects. After comparing the sub-samples of the eastern, central and western regions in China, it is found that the impact of average educational year in western rural region on rural inclusive finance is the strongest, followed by the eastern region, and not significantly in the central region. Combining with the empirical conclusion, this paper puts forward some suggestions on rural financial education and rural inclusive finance, in order to provide ideas for the development of rural inclusive finance in China.

Keywords

Financial literacy, inclusive finance, inclusive credit, rural finance