How Digital Transformation in Commercial Banks Shapes Corporate Investment Decisions: Evidence from Chinese Listed Firms

The digital transformation of commercial banks (DTCB) has altered the way financial institutions collect, process, and use information, with potential implications for firms' investment behaviour.This study examines whether and how DTCB affects corporate investment efficiency using panel data on Chinese listed companies from 2013 to 2023.The results indicate that a higher level of DTCB is associated with a statistically significant improvement in corporate investment efficiency.Further analysis suggests that this effect operates primarily through two channels: a reduction in financing constraints and a decline in agency costs.The heterogeneity analysis shows that the positive effect of DTCB on investment efficiency is concentrated among privately owned firms, while no significant effect is observed for state-owned enterprises (SOEs).These findings provide evidence that the DTCB reshapes firms' financing and governance environments in ways that influence investment outcomes.The study contributes to the literature on digital finance and corporate investment by offering firm-level empirical evidence on the economic consequences of banking digitalisation.