On The System Guarantee Of The Risk Prevention Of China 's Small Loan Companies

The micro-credit company has started the pilot project since 2005 and ended at the end of 2012, with the number of more than 6000, which reveals that micro-credit company caters to the demand of the social development and it is the product of social development. However, due to the conversion of village banks threshold is too high, the vast majority of micro-credit company have no access to the village banks, and micro-credit company still exists as micro-credit company for quite a long time. Therefore, the sustainable development of micro-credit company is particularly important, and a set of perfect risk prevention system is a precondition for the sustainable development.The major risks of micro-credit company can be divided into the internal and the external risks. The internal risk mainly refers to the operational risk, that is, the risk is caused by the imperfect internal control system and administration system. While the external risks refers to the risk excluded the internal risk, mainly includes credit risk, liquidity risk, market risk and natural risk. In this article, the external risk mainly refers to the risk caused by the imperfect and unsound system of the micro-credit company.To prevent the above risks that the micro-credit company comes across, a series of policies have been promulgated, such as the On the Micro-Credit Company Pilot Guidance jointly issued by People’s Bank of China and China Banking Regulatory Commission and the Interim Measures about the micro-credit company promulgated by each local government, but these provisions are too general, fragmented and incomplete, resulting many flaws existing in the risk prevention system of micro-credit company. Its defects mainly list as follows:1. prevention system of internal risk. Operational risk:the imperfect internal control system and industry associations system; 2. prevention system of external risk. (1)Credit risk:the imperfect coinsurance group system and credit system;(2)Market risk:the imperfect administrative regulations, rules and restrictions on interest rates and agricultural price hedging mechanism;(3)Liquidity risk:the unreasonable sources of funds requirement and tax system;(4)Natural risk:the lack of agricultural insurance system.Thus, we need to learn lessons from successful micro-finance institutions outside the typical experience. In this paper, the Grameen Bank, the Indonesian People’s Bank and Wells Fargo are selected as typical representatives to analyze their successful experience and by combining with our country’s national conditions, to acquire the system which can be used as reference to the development of micro-credit company. For the risk prevention system of micro-credit company defects, it will still take time to put forward the perfect suggestions on the basis of learning outside experience. Therefore, a mechanism is proposed, that is, through the establishment of cross-linked coinsurance and the punishment and incentive system under the structure of information-sharing to improve the punishment group guarantee system; micro-credit and micro-finance agricultural insurance jointly develop and improve the agricultural insurance laws and regulations; perfecting laws and regulations of social credit inquiry system and for the construction of the company’s own credit system; For other risk prevention system defects, of course, the concrete suggestion measures are also put forward in this paper.