Abstract: Based on the panel data of 31 provinces in China during the period of 2006-2015, this paper applies the factor analysis method to determine the evaluation index system of inclusive financial development level from multiple dimensions. Then it employs the spatial Durbin model to examine the influencing mechanism of the level of the inclusive financial development on poverty alleviation. The findings show that when such factors are controlled, i.e., government expenditures, industrial structures, level of urbanization, consumption level and the opening degree, the level of inclusive financial development of any region can have a significant positive impact on poverty alleviation. At the same time, the level of inclusive financial development of the neighboring regions together with the spatial relationship can produce a positive spatial spillover effect on poverty alleviation. The inclusive finance can not only alleviate poverty through increasing income, promoting economic growth and increasing equity capital, but also reduce the poverty rate of the neighboring regions significantly through the spatial spillover effect.

Key words: level of inclusive financial development; poverty alleviation; spatial spillover effects