The Research On Folk Financing Of Small And Micro Businesses Of China

As the most active economic entity, small and micro businesses(short for small andmicro enterprises)plays an irreplaceable role in the economic development of China, fiscalrevenue, employment, social stability and so on. Twenty years have passed since theestablishment of the Chinese capital market in1990, and large enterprises are graduallydiverting from bank financing into capital market. At the same time,small and microbusinesses are becoming a stable and sustainable source of customers. However, becausethe initial stage of the China’s commercial banks is still developing,there are also manyshortcomings in service quality and the variety of financial products. As for small andmicro businesses, less transparent information, unstandardized operation and lack ofcommercial credit become major bottleneck restricting the development of small and microbusinesses. A series of events lately create a great sensation, such as running away ofenterprises’ owners and the foundation of Wenzhou financial comprehensive reform area,and the financial problem of small and micro businesses become a hot topic again. Undersuch situation, this paper aims at putting forward to solve the problems, and suggest theperspectives of folk financing. Firstly, analizing the theory of small and micro businessesand folk financing; secondly, the correspondence of these two; thirdly, comparing thepractical experiences abroad; the last, raising suggestions of perfecting the problems. Allthese hope to broad the folk financing of small and micro businesses and guide the steadydevelopment of small and micro businesses.