Formation Mechanism And Countermeasures Of College Loan Predicament

With the implement of increasing inrollment and development vigorosly for our colleges, we have maked great achievement in all aspects in education. But there is a series of college debt issues with the high speed trasition from ELITE to PUBILIC. College inrollment need education facilities. Because institutions of higher education enrollment needs the hardware ratio at the software and effective support, With the doubled increasing number of students, teachers and facilities in colleges cannot suit for the inrollment need.A lot of colleges in the whole country need a huge number of fund to support daily operating, improve teaching condition and enhance comprehensive strength seriously. But for one reason, there is not enough government fund for colleges and input from government cannot meet the high speed expending need. For another reason, the increase of income from service charges is limited and making colleges to financing from other ways. As the reason of the policy aspects, outside debt is no doubt an important financing recourses and become a effective means to release financial strain for colleges. So bank loan become the top capital source. College debt becomes a common phenomenon momentarily. While the huge scale of college debt do not focus on controlling risk, there exist blindness expanding and ineffective use of recourses. Excessive debt makes colleges face huge stressure to repay the capital and interests. Many colleges use new debt to pay for the old ones and college cannot repay the debt becomes a serious problem. Colleges lost in financial crisis.Hainan province was build in 1988 which is later than others, so higher education starts later and educational level is lower than the same class colleges in our country. Not only the number of colleges is short, but also the Issues of short in infrastructure and teachers exist and colleges is in expanding makes the situation much worse. Universities in other provinces facing the situation of massive debt, expansion of education in the development, the universities in Hainan Province have also embarked to follow. Because lower revenue in Hainan Province, the weakness of higher college's finance, Hainan Province debt development is different from the developed provinces or well-known institutions of higher colleges'situation, so, how to keep and control the risk from college overdue debt and maintain college financial safety in a positive attitude and make sure higher education develop steady is an urgent task for government, bank, colleges and creditors. In recent years by the university in Hainan Province were analyzed, we can see the development of Hainan Province large funds needed for the fiscal income and business income are limited, resulting in the funding gap, need external financing to solve this in the future Annual required payment of principal and interest of external may be the normal operation of a certain risk of college, the university's repayment capacity is limited.This text focuses on college debt issue and based on nine colleges in Hainan province. After describing the process in Hainan college debt development and the current situation, we analyze the forming reason, which includes high cost of merging, the blindness enrollment, ineffective use of recourses, lack of government input and not good at supervise fund. Begin with the theory of economics and higher education input, we find the basic theory to solve crisis.Based on the current debt condition of Hainan colleges and the actual situation, learning from other colleges methods and countermeasures in other provinces and the related literatures, we discuss possible ways to solve the debt issue concluding and summarizing from the country, bank and colleges. We make up a lot of methods to deal with the college debt issues hoping to help colleges to get out of debt dilemma, to operate normally and develop sustainably. At last, we come out a conclusion to deal with the college debt issue, includes setting perfect college financing, finding other ways to raise fund, making scientific development plans, controlling operating cost and complete budget system. The ways to solve college debt may offer regular reference.