Supply Chain Finance, FinTech and Corporate Risk-Taking: Evidence from Textual Analysis of China Public companies’ Announcements

In this study, we analyze the impact of FinTech-enabled supply chain finance (SCF) on corporate risk-taking through text analysis of SCF and FinTech keywords within 3.2 million announcements by public companies in China from 2007 to 2019. Our findings reveal that SCF significantly enhances firms’ risk-taking behavior and value. More SCF business types and frequent mentions of SCF in announcements correlate with higher risk-taking levels. Key mechanisms include easing financial constraints, broadening investment scopes, and improving capital efficiency. FinTech, with its advancements such as big data, artificial intelligence, and cloud computing, plays a crucial role in facilitating SCF’s effectiveness. The impact is more pronounced among companies in eastern and central China, larger firms, SOEs, and those in highly competitive sectors. These findings are still valid after a series of robustness tests.