Study In Credit Limitation Of Small And Medium Businesses' Finance

With the development of China's market economy, small and medium businesses have already been becoming a new key to economic growth. Yet there is no denying that small and medium businesses are still in the early phase, faced with a number of insoluble problems, among which financing channel is especially worth mentioning, hindering those businesses from further development to a degree. After careful analytic study of the difficulties in their financing at present, I think the core to solve it is to settle the problem of their credit limitation.My essay begins with an investigation into the structure of small and medium enterprises abroad and makes a comparative study about the present financing condition of the small and medium businesses at home. Moreover, focusing on the solution to the financing problem through credit limitation, it analyses and discusses some credit limitation measures that suit the practical operation in banks of China at this stage. To be more specific, I think it is a one-sided act to solve the difficulties in financing of small and medium businesses only by intensifying credit limitation. Therefore, only when the risk is under control, coupled with credit limitation measures, can they more efficiently solve the problem of hard financing.Market economy is economy of legislation and credit as well. It needs certain regulations to guarantee its effective operation. Law, as a formal inner regulation, plays an important regulatory role in market economy. Nevertheless, as an informal inner rule, credit means a lot more in saving exchange cost and improving economic efficiency in some aspects. Hence, the essay starts with credit practices of small and medium businesses from banks, and lays particular stress on solutions to practical problems based on certain cases and data. What's more, it attaches great importance to the regulations of credit limitation of small and medium businesses inChina, thus raises some new ideas and suggestions, hoping that it will help credit business between China's commercial banks and small-and-medium-scale enterprises and credibility construction of those enterprises in China.