Abstract: Along with the deep integration and innovation of the mobile internet, information technology and finance, the inclusive finance in China has stepped into a digital age. Based on the provincial-level data from 2011 to 2015, the paper analyzes the impact of inclusive finance on urban-rural income gap and investigates the potential spatial spillover effects during the digitization of the inclusive finance. The research results are as follows: there is significant positive spatial correlation in the urban-rural income gap, with relatively low internal fluidity and steady duality in space; it is helpful to develop the inclusive finance for narrowing the urban-rural income gap, and compared with the traditional inclusive finance, digital inclusive finance can not only narrow the urban-rural income gap in areas where it is carried out, but bring on significant overall spillover effects within a short term and exert positive impact on narrowing the urban-rural income gap in the neighboring areas, besides, the spatial spillover effects of the digital inclusive finance mainly depend on the support of digital service. The above findings effectively prove the digital value advocated in the higher principles of G20 digital inclusive finance and offers experience proof for spreading digital inclusive finance. Thus, it is imperative to take digital financial service as the priority in the inclusive finance and play a bigger role in improving the urban-rural income pattern in China.

Key words: digital inclusive finance, spatial spillover, urban-rural income gap, spatial econometric model