Exploration On And Prevention Against Legal Risks About Pledge Financing Of Accounts Receivable For Small And Medium Enterprises By Financial Institutions

Since many small and medium sized companies concentrate their assets on inventory and accounts receivable, financing has become the global challenge for them. Today, in developed countries and regions, taking the accounts receivable as guarantee to obtain financing has become a very important channel for these companies. In china, it changed until the property law come into effect, but in property law, it just simply stipulates that accounts receivable can be used as guaranty, but with regards to standardized registration system only can be seen in regulation on accounts receivable pledge registration issued by china's central bank of china and our accounts receivable pledge registration system has been officially opened in 2007. But this kind of financing is still immature in china due to imperfect legal environment and short of experiences in this filed, which impose high risks in the practice of daily operation. Although some scholars have made various researches from the theoretical point, instead of practical one. This article has taken case as clue to analyze the risks in practical operation facing financial institutions and come up to some countermeasures, so as to provide some helps for both academic and business fields, which is also the essence of this paper.Apart from preamble and epilogue, this paper has 3 parts. The first part introduce the current situation of financing of small and medium companies and related regulations with aim to demonstrate the significance of taking accounts receivable as guaranty.The first and the second section of the second part formulate the definition and feature of some concepts. The third section of the second part and third part are the key section of this paper. The third section of the second part has analyzed the specific case related to financing through taking accounts receivable as guaranty, and show its risks:1. Plegor qualification 2. The problems existing in regulations on account receivable pledge registration, such as registration review, registration antagonism etc.3.The regulations and laws related to garnishee.4. Other legal issues which this paper dose not involve. The third part provide countermeasure against the legal risks existing in above mentioned cases:1. Improve the relevant laws 2.Regulate the operation of financial institutions 3.Other international practice to fight against the risks.