Jiali Yang ^1* Meseret C. Abate ² Zhijiang Yang ^1*

• ¹ Shaoguan University, Shaoguan, Guangdong, China
• ² Hunan University of Science and Engineering, Hunan, China

Enhancing agricultural productivity and promoting sustainable development in China are critical priorities, given their significant contribution to food security and rural development. However, achieving consistent agricultural productivity growth across regions and sectors has been challenging, leading to inefficiencies and environmental pressures. To address this, the potential of digital financial inclusiondigital inclusive finance (DIF) as a catalyst for progress has been explored.This study investigates the impact of DIF on agricultural total factor productivity (ATFP) through farmland transfer, with implications for rural revitalization and high-quality agricultural development. Using the HMB index method, we calculate and decompose China's inter-provincial agricultural total factor productivityATFP from 2011 to 2020. Employing the dynamic panel fixed effect model and SYS-GMM method, we empirically test the influence of digital inclusive finance DIF on agricultural productivity in relation to farmland transfer.Result and Discussion: Our findings reveal a slow upward trend in China's agricultural total factor productivityATFP, driven primarily by scale efficiency. Notably, a 1% increase in the general index of digital inclusive finance DIF correlates with a 0.136% increase in agricultural total factor productivityATFP. We analyze the sub-classification indexes of digital inclusive finance, namely coverage breadth, depth of use, and digitalization degree. Their contributions to agricultural productivity growth are significant, with coverage breadth having the greatest impact, followed by depth of use and digitalization degree. Farmland transfer acts as a crucial intermediary, enhancing agricultural allocation efficiency and driving the relationship between digital finance and total factor productivity growth. Interestingly, the western region exhibits the highest growth rates, followed by the eastern region, while the central region shows no significant effects.To comprehensively enhance agricultural total factor productivityATFP, aligning supply and demand for digital financial services, leveraging service depth, and guiding farmland transfer according to local conditions are essential. These findings offer valuable insights into effective strategies for maximizing the potential of digital inclusive financeDIF, promoting rural development, and achieving sustainable agricultural growth.