Abstract: FinTech has reshaped the entire financial ecosystem and economic operational system, leaving small and medium-sized enterprises (SMEs) unable to remain unaffected as risks and opportunities coexist. This paper conducts an empirical study by using unique large sample data of SMEs to examine in detail whether and how financial technology affects their performance. The findings show that for SMEs, the risks brought by the development of financial technology outweigh the opportunities, and have a significant negative impact on their performance. This impact mainly comes from the contraction of credit supply, intensified industry competition, and stricter financial regulation. The heterogeneity test results show that the impact of financial technology on the performance of SMEs is closely related to the stage of financial technology development and the level of traditional financial development. The exploratory test results indicate that the impact of financial technology development on the performance of SMEs is more manifested as a significant decrease in operating profit margins and a significant increase in management expenses. At the same time, facing the enormous challenges brought by the development of financial technology, from the dual perspectives of enterprise and policy, it systematically reveals the response logic and external support path of SMEs in the context of financial technology development. Based on the above conclusion, the government should improve the top-level design for the development of SMEs and implement related policies and regulations. Financial institutions should rely on financial technology transformation and innovate product services to broaden their financing channels for enterprises. SMEs should leverage financial technology to accelerate transformation and upgrading, and achieve high-quality development.

Key words: financial technology, SMEs, performance, national tax survey data