The Legislation Research On The Rural Non-formal Financial Organization System Of China

"Three rural" issues related to people's livelihood as a major event is locked again in the Central First Document of 2010.Financial support to rural finance are just like the human body's blood, a realization of "three rural" healthy functioning a source of power, its importance goes without saying. For a long time, there is inadequate supply of formal financial institutions in China's rural areas. However, a large number of informal finance has played an important role in meeting the financial needs of farmers and SMEs in rural areas. But the illegal fund-raising, underground banks, ROSCAs "tricked" storm and other non-formal financial institutions are also increasingly a certain degree of financial risks. How to maintain the unique advantages of the rural non-formal financial institutions simultaneously, carry on the legal rules and regulations to them, which will constitute the starting point and goal of this article.In the first part of this paper, the author has analyzed non-regular financial essential factors, such as concept, type and so on. And then, the founding of the general process of financial development in rural areas are briefly reviewed. At the same time, lead to the different development situations of rural non-formal finance in various stages.The second part of the article to Institutional Change Theory as a tool in combination with changes in the course of China's rural financial system and concluded that China's rural non-formal financial institutions is accompanied by the presence not provide an adequate supply of formal financial background, bottom-up generated, in order to conform to the rural financial needs for the purpose of endogenous institutional change. Next, the article analysis the positive factors, such as non-formal financial possess information superiority, mortgage advantages, and the negative factors, such as non-standardized operation and optional establishment interest rate .The third part, According to the current legislative practice, the author focuses on the analysis of the feasibility of legislation: first, that the idea of the current legislation has been changed to ease pressure; second, introduced since 2006, the CBRC and the central bank In the relaxation of non-governmental finance, encourage private capital into the rural areas of the financial sector to active exploration, particularly with the establishment of village banks, small loan companies and rural financial credit union rural. Come to the conclusion: the concept of changes in legislation and legislative practice in advance have prepared in the quantitative change for putting the rural non-formal financial institutions under the legal system.The fourth part of the article, through comparative analysis, based on the ROSCAs legal system of China's Taiwan region and the legal system of the U.S. community banks respectively, the author find there is a high degree of similarity between the ROSCAs legal system of China's coastal areas and the system in Taiwan, China's village banks and community banks of the United States. So in the light of China's actual conditions, We can carry out their legislative experience of advanced learning.The last part of the article puts forward legislative proposals on the basis of the previous statement : First, as to the legislative path, the right will be combined with a certain degree such as a standardized non-governmental financial organizations can conditionally legalized, but when the conditions are ripe to switch to the regularization of the track; Second, in terms of specific legislative measures, depending on the different type and nature of the organization , on the one hand, the behavior of non-formal financial organizations, such as loan-sharking, running underground casinos, underground banks, should be strengthened to rectify in the legislation to ban. On the other hand, ROSCAs and other private mutual financial organizations, should be given the relevant laws and regulations guiding regulation as soon as possible. Normative documents have already been promulgated, such as "Provisional Regulations on the management of rural credit union funds", should be amended in accordance with feedback from rural areas.