This paper examines economic inequality through digitally financed e-commerce as a new perspective. Digital finance is good for output production, which can attenuate regional income inequality in China. Falling search costs with e-commerce technological progress boost more online search for better price discounts. The resulting increase in spending propensities is higher in remoter, poorer, or smaller regions, so that consumption inequality declines more than income inequality as recently observed in China. This theoretical result is consistent with our empirical finding that China’s ratio of income to consumption inequality rises significantly with rapid developments in its Fintech and e-commerce. Additionally, this ratio is found to decrease with wider economic openness but increase under improved transportation conditions.