Study On The Mode Of Financing Of SMES In China

The study of Small-and-Medium-sized Enterprises (SME) is an important one in the economy field The experiences of development of the world economy and the reform of China have displayed that, although the big enterprises play the basic role in national economy, the SME have wide room to develop because they can improve the employment, activate the market economy, increase the income, stabilize the society and so on. However, the SME often find it difficult in financing which in turn limit the further development. There are two main reasons. Firstly, there are environmental limits outside; secondly, systematic limits inside. Both make the SME in a strange circle in financing. Therefore, whether to resolve this problem influence the national economy. This article analyses the reasons of financing problems of SME and study the choices and uses of financing methods. So, it has some theoretical value and is realistically important.There are three main parts of this article.Firstly, it introduces the definition of financing, the discrimination of financing methods and it appraise the different methods. It also introduces the development inclination and characters of SME. Then, it analyses the English-America Model and Japan-Germany Model.Secondly, it analyses the reasons of financing problem of SME including the indirect methods and direct methods.The third part is the main one of the article. At first, it analyses the financing principles and decision elements of SME. Next, it proposes the methods and strategies of financing of SME. Finally, it gives the conclusions.