Study Of Private Financing For Smes

The situation that small and middle enterprises ( SMEs ) in China are short of capital and have low capability to financing is the main factor that restrains SMEs to develop.Private placement is the contrary to public placement. It raises money via the private negotiate and bidding with the established investors or creditors. It has excessive means which rests with the promise of the party. The enterprises financing via public placement may be limited by high factors. The relative authorities such as China Securities Regulatory Commission legislated strict statutes on the public placement stocks and bonds. Compared with the public placement, the privateplacement has more flexible means and more loose condition. So, private placement has become a very important financing means of Chinese SMEs.In this article, the author makes a study on the origination and development of U.S. private placement market and the revelation to us. Also, the author makes a study on the Chinese private placement especially the Chinese SMEs private placement and the meaning which private placement bring to Chinese SMEs. In the last, the author points out the problems in our private placement market and the suggestions to handle them.