Digital transformation disclosure and bank loans: An information heterogeneity perspective

This study examines the impact of digital transformation disclosure on firms’ ability to obtain bank loans. Analysing a large dataset of Chinese listed firms from 2007 to 2021, our findings indicate that both substantive and non-substantive digital transformation disclosures are positively related to bank loans. However, these effects are more pronounced in firms with higher information credibility than in those with lower credibility. Channel analyses indicate that digital transformation disclosures enhance bank loan accessibility by increasing market attention and alleviating banks’ concerns over default risk, while government intervention serves as an alternative mechanism influencing firms’ access to bank loans. Further analysis reveals that substantive digital transformation disclosures improve corporate performance, enhance resource allocation efficiency, and mitigate underinvestment. In contrast, non-substantive digital transformation disclosures do not yield such benefits and may even lead to overinvestment. Moderation analysis indicates that firms engaging in non-substantive digital transformation are able to secure excessive bank loans; however, robust corporate governance and FinTech development can constrain such speculative behavior. Our study contributes to the literature on digital transformation disclosure and extends research on the determinants of bank loan accessibility.