Financial Technology and Real Economy Dynamics: Exploring the Impact on Investment Efficiency and Financial Stability in China

Financial Technology (Fintech) is transforming the relationship between the financial markets and the real economy by favoring faster transactions, automated decision-making, and more convenient access to data. Current research explores the impact of Fintech adoption on the financial stability and investment efficiency of 124 publicly traded companies in various industries in the period between 2018 and 2024. The analysis was based on data collected in terms of investment and financial reports and digital transactions. The relationships between key variables investment efficiency, financial stability, the degree of Fintech adoption, and the size of firms were examined through a multilevel regression model and path analysis. The issue of interest in this investigation is the adoption of Fintech technologies accelerates the decision-making process, reduces information asymmetry, and increases capital allocation efficiency, which influences the firm-level investment efficiency and the financial stability of firms. The SPSS-computed sensitivity tests, hierarchical regressions, and diagnostic correlation tests provided a strong analysis. The findings indicated that high levels of Fintech integration (15% improvement in investment efficiency and 10% improvement in financial stability indicators) yielded higher levels of performance as compared to low levels of Fintech integration firms. These findings indicate that Fintech adoption boosts investment efficiency and financial resilience, which is strategically important in spurring the long-term growth of the real economy.