Research On Medium And Small-Size Enterprises' Credit Financing Cost

Since the reform and opening up, Chinese medium and small-size enterprises (MSSEs) grow rapidly and become a decisive increasing power in our economy. However, MSSEs encounter many adverse facts in their growth and inadequate financing is in especially. In the western development countries, MSSEs' inadequate financing is a homogeneous economic phenomenon. On the contrary, in our country, raising capital of MSSEs is affected not only by economy facts but also by the adverse facts arise from hysteresis of economic restructuring.After joining WTO, our MSSEs get more development opportunities as well as more challenges. Analyzing MSSEs' inadequate financing and tying to solve it relates to not only the future of MSSEs but also the stabile increasing of national economy.This is why I choose it as my thesis. Under the present circumstances, commercial banks are monopolizing the financing market and they are the major way for MSSEs to get capital. And so bank financing is the study object of this thesis. Within this bound, the author chooses transaction cost as a tool to analyze the transaction between MSSEs and banks.The structure and content on the whole article are as follows:Chapter one analyzes the status and reasons of MSSEs' inadequate financing in detail. The first part illustrates the important role of MSSEs in our national economy at the angle of the key element national endowment characteristic. However, the capital MSSEs get from commercial banks don't match their status in the economy and the cost is one of the major facts. Solving MSSEs' financing problem dependents on to a large extent decreasing the transaction cost between MSSEs and commercial banks.Chapter two analyzes the difficulties of MSSEs' financing at the angle of transaction cost. Banks and enterprises are both economic entities with independent economic interests and the transactions between them also exists cost. Considering that transaction cost is a primary economic cause of MSSEs'inadequate financing, the author tries to further discuss the problem at a theory level. This study firstly clears the correlated conceptions of transaction cost and then has a general analysis of the transaction cost between MSSEs and commercial banks. Finally the author draws a conclusion that it is transaction cost that causes the decrease in balanced capital.Chapter three analyzes the difficulties of MSSEs' financing at the angle of institution cost. Firstly, the formal bounds such as control interests, state-owned economy-oriented financial system, shortage of credit mortgage agencies and medium and small-size financial organs influence together MSSEs' financing. Secondly, many informal bounds also hamper MSSEs from getting credit conveniently, commercial banks' discrimination for example. Finally, lacking for strong and power enforcement regulations further worsens MSSEs' financing.Chapter four puts forward six measures for MSSEs' inadequate financing. The first measure is to push market-oriented reform of credit interests actively to make all kinds of enterprises get credit under equal circumstances. The second measure is to strengthen social credit system to decrease the transaction cost between banks and MSSEs as well as increase the cost of breach. The third measure is to perfect the guarantee system of MSSEs from two aspects. One is credit evaluation system of MSSEs and the other is credit guarantee system of MSSEs. The forth measure is to develop the medium and small-size financial organs because they can make good use of the local information and overcome the asymmetries information between banks and MSSEs. The fifth measure is to deepen the reform of state-owned commercial banks. The sixth measure is to enhance the financial quality of MSSEs because the thorough improvement of financing environment of MSSEs, in the final analysis, conditioned by the development of the MSSEs themselves.