Research On The Influence Of Inclusive Finance On Shadow Banking Scale

With the rapid development of China’s economy and financial changes,shadow banking,which is mainly characterized by interbank business,has developed relatively rapidly.The bankruptcy of village banks in recent years has fully illustrated the danger of shadow banking and the urgent need to regulate and rectify it.In contrast,the development of inclusive finance is better than shadow banking in terms of risk prevention and control as well as the provision of formal and legal credit services.In recent years,the state has introduced a series of policies to stimulate the development of inclusive finance,which to a certain extent has positively guided the healthy development of financial services for small and micro enterprises and the three rural areas,while also curbing the scale of development of shadow banking.Therefore,it is of theoretical and practical significance to study the impact of inclusive finance on the scale of shadow banking for the healthy development of the financial industry and the safe operation of banks.Based on the exploration and analysis of the laws of shadow banking and the development of inclusive finance,this paper analyses the mechanism of inclusive finance affecting shadow banking,and studies the impact of inclusive finance on the scale of shadow banking from three aspects:policy regulation,differential scale effect and return on assets.To further empirical research,this paper constructs a panel regression model using data from 61 commercial banks in all provinces of China from 2011 to 2020,with the size of shadow banks as the explanatory variable and the financial inclusion index as the core explanatory variable,to empirically analyze the impact of financial inclusion on the size of shadow banks.The number of financial outlets per 10,000 people(WD)and the rate of personal credit file creation(DA)of commercial banks were used as instrumental variables in the endogeneity treatment of the model and regressed using the least squares method.The regression results show that the results of this paper remain robust after the endogeneity problem is addressed.Secondly,heterogeneity analysis of the impact of financial inclusion on shadow size according to the size of the financial index and the type of bank shows that the degree of financial inclusion development of commercial banks with low financial inclusion index has a more significant impact on the size of shadow banking compared to commercial banks with high financial inclusion index.This indicates that the impact of financial inclusion development on the size of shadow banking has a significant regressive effect.The regression results of the heterogeneity analysis based on bank type show that the impact of the inclusive finance index on shadow banking size is significant for urban commercial banks and rural commercial banks,indicating that the inclusive finance policies of urban commercial banks and rural commercial banks have a driving effect on the size of shadow banking.Finally,the moderating effect analysis using the crossproduct term of financial inclusion and capital return shows that the capital return shows a positive moderating trend on the extent to which financial inclusion affects shadow banking.From the results of the empirical analysis,it can be found that through measures such as strengthening policy regulation,inclusive finance has a certain inhibitory effect on the scale of shadow banking.At the same time,the degree of impact of financial inclusion on the scale of shadow banking also has a certain scale difference effect,i.e.the degree of impact of financial inclusion on the scale of shadow banking is much higher for urban commercial banks and rural commercial banks than for state-owned banks and national joint-stock commercial banks.Therefore,the continued popularization of financial inclusion policies to small and medium-sized cities and rural areas can help further reduce the size of shadow banking.