Microfinance In China Study On Sustainable Development

China is a large agricultural country and rural population accounts for a large proportion of its total population. In the long run, incomes of farmers grow slowly, and there is a big gap between urban incomes and rural incomes. To develop rural economy in a large margin, rural financial service is necessary. However, farmers have poor ability against risks. No assets are to be mortgaged for them, which causes that many regular financial organs are unwilling to make credit business in rural areas. Therefore, credit demand of farmers has been seriously limited.At the same time, small and medium-sized enterprises in China also face serious challenges because of influence from financial crisis. The small and medium-sized enterprises have small business scopes, backward technology and weak competitive ability. Their credit levels are low and lack assets as mortgage. They can hardly obtain loans from commercial banks.Microfinance, as a kind of service featuring financial innovation, can solve the above problems to a great extent. In the 1970s, many developing countries started credit business toward remote areas and small-income people for the purpose of making more people away from poverty. Patterns of the business are different. The concept of microfinance is formed on the basis of these business patterns. The earliest microfinance happened in Bangladesh, its operation pattern obtained great success. The initiator, namely, Professor Yunus, obtained 2006 Nobel Peace Prize with this. Through special system design, microfinance provides loans without taking assets as security, and with small amounts and high interest rates. At present, microfinance in many developing countries do not set to aid the poor but start business for the group of people with low and medium incomes. Microfinance has more than ten years of development and achieved a great success. However, there are some problems, in which the major is how to realize sustainable development.The text at first introduces domestic and foreign research results of sustainable microfinance development, and makes elaboration of microfinance and the theoretic basis for sustainable microfinance development. Then, the text made analysis on microfinance examples which have obtained success in the world, selected Grameen Bank,Bank Rakyat Indonesia, BancoSol and Cambodia ACLEDA, and summarized their own experiences. Then the text analyzed the four stages experienced by microfinance in China and features of the stages, chose Chinese examples and specifically analyzed sustainable developing targets of microfinance. Finally, in accordance with elements influencing sustainable development of microfinance in China, the text advanced the suggestion to promote sustainable development of microfinance in China from macro and micro aspects and hoped this will be helpful on sustainable development of microfinance in China.