A Research On The Characteristics And Effects Of Non-governmental Lending Intermediary's Behavior In Qingdao

This paper is to analyse the characteristics and effects of non-governmental lending intermediary's behavior based on the review of non-governmental lending intermediary's development,therefore,to prompt sustainable and healthy development of non-governmental lending intermediary as an efficient financing channel for small and medium-sized enterprises.As far,research on informal financial institutions is limited to ROSCAs.Research on non-governmental lending intermediary is only about its nature and characteristics of its clients on supply-side and demand-side. This paper will discuss these institutions further,which is useful in enriching the research on informal financial intermediary and improving supervision on these institutions.Firstly,this paper is to review the foreign and domestic research on informal finance and other related fields. Secondly,it analyses the emerging background and development features of non-governmental lending intermediary,therefore it defines the non-governmental lending intermediary.The background includes the change of supervisory authority's attitude,the rationed credit in small and medium-sized enterprises credit market and the boom of non-governmental fund supply.The emerging characteristics include spread from coastal cities to other regions and difference of these institutions development in different areas.The development characteristics are as follows,the influence is strengthening,it reaches more areas,the self-discipline organization is formed,the range of operating is enlarging and its development has much to do with the acquiescence of government.The non-governmental lending intermediary is defined from five aspects,i.e,its core business is to help in reaching an agreement of short-term and high-risk credit,the main measure of risk control is the mortgage,it supplies a lot of services to facilitate transactions,its marketing is based on the professional relationship and the transaction feature becomes evident,it's supervised as general enterprises and free of financial regulation.Thirdly,this paper analyses the characteristics of non-governmental lending intermediary's behaviors in Qingdao,which includes pricing,marketing,cooperation with other institutions and risk control.The analysis of pricing behavior includes the determination of service rate and interestrate.The marketing includes professional relationships,advising,promotion in media and setting up branches.The advertisement has greater influence on borrowers than lenders,that is,the borrowers non-governmental lending intermediary attracts through advertisements have a larger proportion in overall clients than that of lenders attracted by advertisements.Compared to larger-scale non-governmental lending intermediaries, the clients attracted by advertisements of the smaller ones have a larger proportion.Cooperation between non-governmental lending intermediaries,cooperation with formal financial institutions are included in cooperation analysis. The analysis of risk control is from three aspects,the operational process,the source of risks and the risk control features.The characteristics are as follows,the main tool of risk control is to take real estate as mortgage,the main measure to deal with default is to extend the period,the examination before lending is strict but the inspect after lending is insufficient,it begins to employ the industry self-discipline.Then,this paper evaluates the effects of non-governmental lending intermediary based on the investigation results in Qingdao.These effects are as follows, it has greater influence on short-term credit market,its effect is limited to short-term mortgage credit market,it operates with formal finance and pawnshops in different ways,therefore supplements the credit market.the shortage of criterion and efficient supervision restrains the growth of the whole industry.Last but not least,this paper draws conclusions and puts forward suggestions to supervision of non-governmental lending intermediary. Legal approval is necessary to recognize the role non-governmental lending intermediary plays in the short-term credit market.The supervision shall insist on the characteristic of short-term mortgage credit.The fit risk control system should be established for the non-governmental lending intermediary. In addition,the proper and sound supervision frame should be set up.The innovation point of this paper lies in the analysis of pricing characteristics of non-governmental lending intermediary. The main points are as follows,the interest rate level of non-governmental lending intermediary is between that of informal finance and that of formal finance,which is legal and maintains a rational level and better reflects the inflation.The adjustment of interest rate in non-governmental lending intermediary is to set a reference interest rate according to that of formal financial institutions and market demand-supply.The interest rate level varies for different risk degrees,larger amount,shorter period,less valueable mortgage mean higher interest rate.The ways of payment in non-governmental lending intermediary are more flexible,the interest is mainly paid back by month and the proportion of other paying methods is decreasing gradually.