On The Perfection Of The Legal System Of Villages And Towns In China

With the construction of new socialist countryside and the increasingly prominentcontradiction between supply and demand of rural financial market, Village Banks whosefeatures are low barriers to entry and flexible equity governance structure begin to enterthe rural financial market. As a new form, Village Banks play an important role inimporving the rural financial environment. They can solve the increasingly strongfinancial needs of farmers, can provide financial support for the development of small andmedium-sized enterprises. Besides, they can promote the process of rural financial systemreform.As a new kind of thing, they are developing rapidly. However, they also have manyproblems in relevant legal system, which are the legal system of internal governance andexternal supervision, operating practice and the revelant policies and regulations. Theseproblems seriously affect the healthy development of Village Banks.This paper adopts comparative analysis and historical analysis, by introducing the basicproblems about the Village Banks’ legal system, it points out the existing problems. Onthe basis of the reference of foreign banks successful development modes and operatingexperience, I gave several proposals of completing the systems of Village Banks. Thereare four parts in this article besides the preface:The first part mainly expounds the meaning of Village Banks as well as Characteristics,the development course and current situtionand. It also represents the significances of thedevelopments and establishment of Village Banks. Through clarifying the correspondingconcepts for the following study.In the second part, the Village Banks’ legislative present situations are introduced, andsome problems are analyzed. There are many of problems in our country’s VillageBanks,which includes the legal system of internal governance and external supervision,Operating practice and some relevant policies and regulations.In the third part, the relevant foreign banks’ devolopment situations are introduced,from which we can summarize some experience which our country can conclude, the Village Banks should create the patterns of lending and financial products; have clearmarket positioning and define the service object; should design theirs operation modecombining with its national conditions; build perfect matched policies and supportsustainable development; value the quality of employees and strengthen the professionaltraining.The fourth part is the key in this paper. This part mainly aiming at our country’s VillageBanks legislation existence the problems to concrete legislative suggestions. This part hasfour sections, the first section is about the suggestions of our country’s Village Banksinternal governance legislation system. The suggestions are optimizing equity structureand promoting the diversification of ownership structure, exploring new way of loanguarantee and improving the rural credit environment, perfecting the payments andsettlement system and carrying out a variety of business. The second section mainly givessome suggestions about Village Banks’ external supervision legal system. We must richregulatory body and perfect regulation system, ease regulation of market access and lowerthe threshold of establishment, improve the mechanism of the risk supervision andomni-directional security monitoring, improve the legal regulation of market exit. Thethird secation give some suggestions on Village Banks’ operating practice,which inculdingfour aspects, there are improving the management pattern and promoting productinnovation, clearing market positioning and adhere to the "yunus", enhancing the capacityof deposit-taking and broadening channels of funding sources, strengthening theconstruction of human resources and reducing the management risk. The fourth part issome suggestions about matched policies and regulations, they are making managementdetailed rules for the implementation expliciting and increasing the support of financial taxpolicy.