This study analyzes data from companies listed on the Small and Medium Enterprise Board and the Growth Enterprise Market between 2011 and 2021 to assess the impact of digital inclusive finance on SME innovation. It also explores how this effect varies across different industries. The results indicate a significant positive correlation between the digital inclusive finance index and the SMEs’ innovation output at the 1% significance level. Furthermore, improving the coverage breadth and usage depth of digital inclusive finance is more effective in promoting SME technological innovation than enhancing their digitalization level. Additionally, the heterogeneity analysis underscores its significant impact on driving innovation within the secondary sector. Mechanism testing reveals that digital inclusive finance enhances the innovation ecosystem by reducing financing barriers and improving access to capital. The study recommends accelerating the development of a digital inclusive financial system and optimizing the allocation of financial resources. Furthermore, it emphasizes the need to support digital transformation, foster talent development, and implement targeted industrial policies. These efforts are crucial for unlocking the full innovation potential of SMEs and driving high-quality development.

This study analyzes data from companies listed on the Small and Medium Enterprise Board and the Growth Enterprise Market between 2011 and 2021 to assess the impact of digital inclusive finance on SME innovation. It also explores how this effect varies across different industries. The findings highlight the crucial role of digital inclusive finance in boosting SME innovation capacity. Additionally, the heterogeneity analysis underscores its significant impact on driving innovation within the secondary sector. Mechanism testing reveals that digital inclusive finance enhances the innovation ecosystem by reducing financing barriers and improving access to capital. The study recommends accelerating the development of a digital inclusive financial system and optimizing the allocation of financial resources. Furthermore, it emphasizes the need to support digital transformation, foster talent development, and implement targeted industrial policies to unlock the full innovation potential of SMEs, thereby promoting high-quality development.