Abstract: Based on the data of listed companies on the SME board from 2011 to 2018, this paper explores whether digital finance reduces the cost of corporate debt financing and its mechanism. It is found that digital finance negatively affects the cost of corporate debt financing. Further, from the perspective of creditor heterogeneity, it is found that digital finance promotes bank loan financing and inhibits commercial credit loan financing. From the perspective of the transmission mechanism of digital finance, enterprise internal control plays an intermediary role in the mechanism identification of the impact of digital finance. Based on this, combined with the empirical research conclusions, this paper puts forward some suggestions on the financing relief of small and medium-sized enterprises from the perspectives of implementing digital financial policy, financial supply side reform and improving the internal construction of enterprises.

Key words: Digital finance, small and medium-sized enterprises, Debt financing costs, Creditor heterogeneity