Research On SMEs' Innovative Financing Ways In Bank Of Communications

Both in developed and developing countries, SME financing is a widespread concern around the world. SMEs are an important part of the national economy in China, which contributed 58.5% of GDP. Its development has a direct affect the health of the entire national economy. Especially with the deepening of Chinese economic reform, development of market economy and the transition period after Chinese entry into WTO, to promote the development of SMEs, to ease the employment pressure in China and to maintain economic vitality and participate in international competition has profound practical significance.The contradiction between the important role that SMEs plays in the economic and social development and its problem of insufficient financing for a long time has already aroused the whole society's attention on financial services for SMEs. For the sake of commercial banks, and how innovative financing for SMEs, broadening financing channels, not only commercial banks how to fulfill their social responsibilities, reasonable and effective allocation of monetary resources, but also in the increasingly fierce market competition, the commercial banks how to deal with credit changes in market conditions, digging this has not been fully valued corporate customers should move the market.The article describes the financing of SMEs in China and the international background of the domestic background of the beginning, the concept of defining SMEs. Bank of Communications,â… chose as a case bank. As one of China's large-scale commercial banks, either in asset size, profitability or credit to SMEs in the degree of attention, Bank of Communications has a strong representation in the banking industry. This case bank is selected as an entry point for SMEs in innovative financing. The subject from the perspective of commercial banks is to suggest measures and countermeasures to solve the academic discussion on SME financing problems.Chapter II describes laws and regulations in corporate finance in Japan, secured financing system in Germany and the support of government procurement in the United States. By comparing the current situation in China and these three countries, we hope that policy makers shall find some help to further improve the policy environment for SME financing and provide a reference program for the government to improve the macro levelChapterâ…¢analyses current objective reasons on SME financing constraints, respectively, from commercial banks and the SMEs perspective. Due to commercial banks'own specificity business products, they exist prudent business philosophy. SME customers does not match the high-risk characteristics. In addition, the asymmetry of information between enterprises and banks is likely to cause adverse selection in credit decision-making problems. Medium-sized businesses have their own inherent defects, such as the lack of collateral pledged and the lack of credit resources force banks unable to take into account the balance between risk and profit point. Thus, although the main object of analysis is from a commercial bank point of view, but we also provide some pertinent suggestions for SMEs finance concerning their efforts to adapt to the current environmentAs China's fifth largest commercial bank, Bank of Communications walk in the forefront of the SME financing innovation. Chapter IV explores the financing patterns for SMEs from three aspects, such as the internal management system, management information systems and innovative financing products. Among these, banks'regulators shall learn how to reduce the management depth and to improve responsiveness to customers'needs reflection and inquiry. IT system and credit score cards is improved to meet the Basel Accord on banks'credit risk control client classification requirements. More specific credit product innovation practice is adopted as the bank's SME targets by means of customized credit products.Chapter V proposed to reduce the credit constraint phenomenon for SMEs, from the angle of SMEs themselves. They need to improve their own governance structure, to improve management skill and to strive to establish long-term partnerships with banks instead of often requiring banks to change their risk preferences, to upgrade management information system and to improve banks' product lines decency. Also, SMEs can't completely rely on government funding and policies. On the other hand, the establishment of industrial clusters of SMEs help to improve their own situation.The article concludes that from the innovative practice for the SMEs markst of Bank of Communications. Through the discussion of this revelation,â… hope that readers can understand only innovation allows a commercial bank based on the strong competitors in an invincible position in the market competition.