Digital finance is an important impetus to foster corporate innovation, which is essential for promoting high-quality development and fostering a new development paradigm. We use a sample of A-share listed companies in China from 2012 to 2023, and use a two-way fixed effects model to investigate the effect of digital finance on corporate innovation. The results reveal that the effect of digital finance on corporate innovation is significant and positive. The moderating effect shows that more intellectual property protection and more active regional technology market may both be complementary mechanisms to enhance the innovation incentive effect of digital finance. The effect of digital finance is more pronounced in the high-tech industry, varies by region, and is robust across regions with different degrees of marketization. Consequently, to maximize the innovation-empowering capacity of digital finance, policies should advance digital inclusive finance along with the concerted step-up of protective effect to intellectual property rights regimes and the technology market ecosystem, and implement differentiated guidance policies for sectors and regions.