Digitalization and supply chain finance risk: Evidence from listed firms in the construction industry

Zhihui Han and Zhitao Wang

Finance Research Letters, 2025, vol. 74, issue C

Abstract: The construction business often involves considerable amounts of “pay-in” that substantially affects cash flow, and supply chain finance is a common practice. This study examines the impact of digitalization on supply chain finance risk. Based on evidence from Chinese construction firms, we find that digitalization significantly lowers supply chain finance risk, and this effect is more salient for firms with weak corporate governance. Further investigation reveals that information transparency and operating efficiency are crucial economic mechanisms underpinning this relationship. In summary, this study complements the strand of research on digitalization and supply chain finance.

Keywords: Digital transformation; Supply chain finance; Construction firm; Risk (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:74:y:2025:i:c:s1544612324017550

DOI: 10.1016/j.frl.2024.106726

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