Development Status, Problems And Solutions Of Credit Guarantee System In Henan Province

As a important part of national economy, SME gives significant contribution on promoting economic development, increasing employment opportunities, improving people's daily life, increasing national revenue, maintain social stability and building up wealthy society. Meanwhile the development of SME also face quite a few problems, the most protruding one is financing channels blocked.Henan province as the 7th industrial province in the nation, its financing situation of SME is representative in the central region. Compared with the developed provinces, SME within the jurisdiction has a "low technology, small scale, less capital" characteristics, which results in a relatively weak position in the capital market and need the government to give some support, One of the most important measure is to establish a credit guarantee system for SME. It is a guarantee service organization which faces to mostly SME, providing the security services SME financing policy of credit guarantee agencies, commercial credit guarantee institutions, mutual aid credit guarantee institutions and credit re-guarantee. The credit guarantee system in Henan province began in 2002, according to the general idea "government guidance, policy support, multi-input, multi-level building, market-oriented operation, standardized management," guides, encourages and supports the establishment of various forms of credit guarantee institutions, builds a SME credit guarantee system with a strong financing capability, covering most parts of the province under a provincial leading, which is also based on a municipal backbone and focusing on the county level with credit guarantee institutions and credit re-guarantee institutions supporting cooperation, to play a positive role. in the promotion of SME development in Henan Province.But the SME credit guarantee system is far from perfect, some counties (cities) have not set up security agencies. The existing agencies are mostly in small size, weak and not reasonable in corporate governance structure, also has problems such as irregular operations and being weak in security ability to withstand risks and guarantee. This results in prominent problems for example difficulty in financing and guarantee for SME and become a major bottleneck in economic development of the province. Face to the plight of the development of credit guarantee system in Henan province, the paper analyzes the current incentives which hampered the development of the Credit Guarantee System in Henan Province using a theoretical and empirical research methods from the legal, institutional, regulatory and other aspects, combined with their own situation and operational characteristics, provides corresponding solutions with the advanced experience from abroad.