Against the background of the accelerating global technological revolution, key digital technologies have become the core field of competition among major countries. Yet innovation activities are inherently “long-term, high-risk, and asset-light”, which creates a structural conflict with the “safety, liquidity, and profitability” principles of traditional bank lending. Consequently, many breakthrough R&D projects suffer from severe financing difficulties. To resolve this mismatch, China has vigorously promoted institutional innovation in sci-tech finance represented by tech-focused bank branches in recent years. Although the policy direction is clear, there remains a lack of solid evidence regarding whether such branches can break through the limitations of the traditional credit model and effectively drive innovation in key digital technologies. This paper aims to fill this gap.

The study finds that tech-focused bank branches significantly promote key digital technology innovation, and this effect is more pronounced in firms during their growth stage, those with smaller market shares, and those with higher innovation quality. Mechanism testing indicates that tech-focused bank branches operate through three channels: providing medium- and long-term credit to alleviate maturity mismatches between innovation cycles and financing terms, building a multi-party risk-sharing system to improve tolerance for innovation failure, and adopting a “technology flow” evaluation system to quantify technological value to mitigate information asymmetry between banks and borrowers. Further analysis also reveals that tech-focused bank branches not only generate synergistic innovation effects with national key laboratories, but also transmit positive signals to government departments through their credit decisions, helping firms obtain more innovation subsidies.

The academic value of this paper is mainly reflected in three aspects: First, it reveals the unique mechanisms through which tech-focused bank branches boost firm innovation, breaking through the theoretical framework of structural mismatch between the traditional bank credit system and innovation activities. Second, it enriches the theory of “sci-tech finance ecosystem” by highlighting the central role and synergistic amplification effects of tech-focused bank branches. Third, it deepens the debt contract theory and reconstructs banks’ risk perception and value evaluation system for technology-oriented firms.