Rural Areas, Pro-poor Microfinance Development Model To Explore

As a new financial channel, microcredit pioneered a way of releasing poverty in a market-oriented manner and has gained its irreplaceable position to resolve 'Poor Supporting' issue. In the reviewing of the history of microcredit worldwide, we find that the goal to increase width and depth in poor supporting has been conflicting with the goal of microcredit institutions to achieve continuous developmentThis dissertation has conducted deep study into the current situation of microcredit in rural country and the problems and other factors that impair continuity of microcredit. It is argued that microcredit practice of Chinese farmers departures from the ideal goals due to the special situations of so called 'Three Rural Problems' , systematic design of fund inflow, operation capabilities of credit institutions and external environment. The essence of the problems is the mismatch of external gain and cost. As long as the external cost is not compensated reasonably, the goals of farmer microcredit and poor supporting will conflict with each other. At the same time, this dissertation has introduced the experience and lessons learned from two main international models of microcredit.Based on the studies of international and domestic microcredit practices, this dissertation has proposed an innovative model under which external cost is peeled off to specific institutions and external gains is valued. The formal financial and microcredit institutions cooperate with each other to undertakethe operation of microcredit. It is also analyzed in this dissertation on how to transform the financial demand of poor farmers, how to restructure the microcredit institutions, and what role the government should play in order to stimulate the development of the new model.