The Legal Risks And Prevention Of Student Loans In Commercial Banks Of China

Student Loan in China is an education policy that benefits both the country andthe people. The policy achieved remarkable results since its beginning. But with therapid development of China’s education and the full penetration of higher educationincreased significantly, the demand of financing also increased, the currentdepartment of China’s legal regulations and other policy provisions can not bematched with the Student Loan. In addition, there are no significant differencesbetween student loans by commercial banks and the policy Student Loan. It needsfurther improvement and innovation.The legal risks of Student Loans in Commercial Banks concluded direct andindirect legal risks, the most important direct legal risk is risk of default, otherrelevant risks like policies and legal risks are also affect the normal activities ofChinese Student Loans. The causes of these risks are manifold: the current creditenvironment in China, compounded by Student Loan mechanism contains someshortcomings and gaps in legislation, leading the Student Loan’s concept of equityand efficiency and the profitability of commercial banks in conflict, so we shouldlearn from the successful countries to improve ours. By comparison, China’s HongKong, Japan and United States, their system and legislation which concluded a groupof student loans will help China’s development experience, such as strengtheninglegislation and our student loan system, while improving student Loan rights andobligations of the parties of the legal regulations, compared with other laws to leadingthe Student Loans to the healthy development.Student Loan is not only the center topic of our education but also the forefrontof economic law issues. By promoting the participation of commercial bank can notonly effectively enhance the field of its functional coverage, but also can guide morefinancial and social capital to education, improve our policy and business in China. Soit is the necessity to solve the problems of the Student Loan, not because to developour education, but the legal system in China.