A Study On The Constraints Of Rural Consumer Credit

The data analysis of rural residents'income and consumption shows that there is an gigantic demands in villages, which constraints by lacking consumer credit to peasants. Based on that, we suggest to develop rural consumer credit market, this paper tries to seek the main factors which have great effect on it, so that we can give some effective,feasible suggestions to the development of rural consumer credit; beside that, this paper discuss the relationship between consumer credit and home applications to rural policy.At first, this paper outlines the definition of consumer credit, business types and characteristics, then analyze the income and expenses of rural Residents in China, revealing the huge demands of bank credit in rural. Based on the result, we reviewed the current status of development of domestic consumer credit, which emphasized on credit quota composition, and unbalance between the town and the rural. The lagging development of consumer credit in rural badly affect the development of rural market, restrict the demand expansion in domestic market.In view of the lagging situation of consumer credit in rural and the significance of consumer credit, this paper aimed at the progress of rural credit market. Through analysis of the factors which lead to the lag situation of rural consumer credit, combined with the Home appliances macro-economic background and economic characteristics of rural citizens, to gain a deeper understanding of consumer credit behavior of rural households.In the paper, we used logistic regression model for quantitative analysis, to test the results of theoretical analysis. It found that volatility of income has a negative effect on the probability of rural residents to obtain the credit from normal banks, so as non-interest cost. But the interest cost, mortgage and literacy of applicant have a reverse influence to the probability.Meanwhile, the paper discussed the effect of home appliances policy to the development of rural credit market. It suggested that the maturity of consumer credit market can stimulate the home appliances policy, but the inverse effect is not remarkable.Based on the result of quantitative analysis, we pointed out that it's a good way to facilitate the development of rural credit market by decreasing the volatility of income and non-interest cost, combined with measures improving the literacy and interest rate. Meanwhile, applicants also benefit from eligible collateral. To improve the effect of home appliances Policy, we can improve the rural financial service system, especially the rural consumer credit market in depth.This study's innovation maybe is that we take the volatility of income into consideration, besides the loan cost and expected income of rural residents. But it's failed to examine the impacts of economic cycle and credit history of applicants, which should be analyzed in the late discussion.