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Financing a sustainable future: Impact of credit term structure on carbon emissions in China
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DOI：10.1016/j.frl.2026.110571.png)
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Abstract
En 中文
While financial systems are increasingly recognized as crucial for sustainable development, the specific role of credit term structure (CTS) in shaping emission trajectories remains insufficiently examined. This study investigates the relationship between CTS and carbon emissions in China. Employing panel data from 30 Chinese provinces spanning 2000–2022, we empirically examine how the temporal dimension of credit allocation affects carbon emissions. Our findings reveal that longer-term credit structure significantly reduce carbon emission intensity through dual channels: decreasing energy intensity and optimizing energy consumption structure away from coal dependency. However, institutional contexts substantially moderate this relationship—economic growth targets and fiscal pressure significantly weaken the emission-reducing effect of longer-term credit. Furthermore, we document considerable regional heterogeneity, with the emission-reducing effect of longer-term credit varying across provinces based on geographical location, financial marketization levels, and resource endowments. The emission-reducing impact is most pronounced in eastern and central China, regions with higher financial market liberalization, and areas less dependent on resource extraction. The findings suggest that optimizing CTS, alongside complementary institutional reforms aligning local government incentives with environmental goals, could facilitate China's low-carbon transition.
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