The development of the financial industry directly affects the sustainable competitiveness of a city and even an economic region, and the development of urban finance helps to enhance the sustainable competitiveness of a city. This paper firstly reviews the relevant theories of sustainable urban competitiveness and explains the impact mechanism of financial development on sustainable urban competitiveness in developing regions. It then draws on the data of 17 prefecture-level cities in Central China from 2006 to 2020. It uses quantitative research methods, such as principal component analysis and regression analysis, to analyse and study the factors of financial development that influence sustainable urban competitiveness, thus realising the research purpose of enhancing sustainable urban competitiveness. After an in-depth analysis, the paper draws the following conclusions: (1) financial development is conducive to improving the sustainable competitiveness of a city in developing regions; and (2) the local government should focus not only on expanding the scale of financial development, but also on the quality of financial development, adjusting the financial structure, improving financial efficiency, and actively promoting the opening of financial markets and innovation of financial products.