Digital finance promotes sustainable total factor eco-efficiency: evidence from China

A super-efficient SBM model was constructed using Chinese provincial panel data from 2011 to 2018 to explore the impact of digital finance on sustainable total factor eco-efficiency (STFEcE) and its mechanisms of action. The results show that digital finance can promote the improvement of STFEcE, and this promotion is heterogeneous. Western regions with more backward financial development, ecologically inefficient regions, and financially weakly regulated regions have more significant eco-efficiency improvements from digital financial services. Digital finance influences STFEcE by expanding the scale of green credit and enhancing the level of green and digital technology innovation. Therefore, the government should support the efficient integration of digital technology and financial services in macro policies, accelerate the infrastructure construction of digital finance, eliminate the digital divide, and create a favourable financial environment for improving STFEcE.