With the rapid development of information technology, digitization has become an important trend in economic and social development. As an important component of the digital economy, digital finance (DF) has the characteristics of convenience, efficiency, and inclusiveness, and has received high attention from governments and financial institutions in various countries. The impact of DF development on regional financial risks is receiving increasing attention. This article explored the impact and mechanism of DF development on regional financial risks from the perspective of DF development, and further analyzed the inspiration of DF development on regional financial risk management. This article conducted empirical research through experimental and control groups. The results indicated that in mature digital financial markets, digital financial services could to some extent improve service utilization and reduce regional financial risks. In areas where the digital financial market was relatively underdeveloped, there was a higher level of regional financial risk. At the same time, the development of DF also faced issues such as information security and regulatory deficiencies. It was necessary to strengthen regulation and risk management to promote the healthy, stable, and sustainable development of DF. Therefore, while promoting economic development and social progress, DF also needed to pay attention to management and governance issues to ensure the sustainable development of DF.

Xi Li. Investigation on the Impact of Digital Finance Development on Regional Financial Risks. International Journal of Frontiers in Sociology (2023), Vol. 5, Issue 7: 39-47. https://doi.org/10.25236/IJFS.2023.050707.

[1] Fritz Barbara, Laurissa Muhlich. "Regional financial arrangements in the global financial safety net: The Arab Monetary Fund and the Eurasian Fund for Stabilization and Development.” Development and Change 50.1 (2019): 96-121.

[2] Ozili Peterson K. "Financial inclusion research around the world: A review." Forum for social economics. 50.4 (2021): 457-479.

[3] Kirikkaleli Dervis. "Time–frequency dependency of financial risk and economic risk: evidence from Greece." Journal of Economic Structures 8.1 (2019): 1-10.

[4] Kolupaieva Irina, Svitlana Pustovhar, Oleg Suprun, Olena Shevchenko. "Diagnostics of systemic risk impact on the enterprise capacity for financial risk neutralization: The case of Ukrainian metallurgical enterprises." Oeconomia Copernicana 10.3 (2019): 471-491.

[5] Campiglio Emanuele, Yannis Dafermos, Pierre Monnin, Josh Ryan-Collins, Guido Schotten, Misa Tanaka. "Climate change challenges for central banks and financial regulators." Nature climate change 8.6 (2018): 462-468.

[6] Fabris Nikola. "Financial stability and climate change." Journal of Central Banking Theory and Practice 9.3 (2020): 27-43.

[7] Kou Gang, Xiangrui Chao, Yi Peng, Fawaz E. Alsaadi, Enrique Herrera-Viedma. "Machine learning methods for systemic risk analysis in financial sectors." Technological and Economic Development of Economy 25.5 (2019): 716-742.

[8] Hussain Javed, Samuel Salia, Amin Karim. "Is knowledge that powerful? Financial literacy and access to finance: An analysis of enterprises in the UK." Journal of Small Business and Enterprise Development 25.6 (2018): 985-1003.

[9] Baum Rachel, Gregory W. Characklis, Marc L. Serre. "Effects of geographic diversification on risk pooling to mitigate drought‐related financial losses for water utilities." Water Resources Research 54.4 (2018): 2561-2579.

[10] Guo Zanwei. "Evaluation of financial ability of port listed companies based on entropy weight TOPSIS model." Journal of Coastal Research 103.SI (2020): 182-185.

[11] Dai Wensheng. "Application of improved convolution neural network in financial forecasting. Journal of Organizational and End User Computing (JOEUC) 34.3 (2022): 1-16.

[12] Grilli Luca. "There must be an angel? Local financial markets, business angels and the financing of innovative start-ups." Regional Studies 53.5 (2019): 620-629.