Reseach On Rural Finance Service Socialization System

Rural finance is an indispensable part in China’s finance system. Since it has beendeveloped in the dual economic system for a long time, compare with urban financesystem, the importance of developing rural finance system has not been valued, andlead to the fact that the backwardness of rural finance development. To develop ruraleconomy need to develop rural finance. To solve the problems exist in rural finance isthe key to solve dual economy issue. And establishing a stable and efficient ruralfinance service socialization system is the solution of rural finance problems.Henan is a big agriculture province, a big grain province. the strategic objective ofindustrialization, urbanization and agricultural modernization that established byCentral Plains Economic Zone need to be achieved by setting up a perfect rural financeservice socialization system. This is the aim and importance of this study.The author got a relatively deeper understanding of the current situation of ruralfinance development in Henan Province through field investigation, questionnairesurvey and data consolidation. At present, rural finance service system was establishedinitially in Henan, but the coverage of rural finance service is far insufficient, thecoverage rate is less than40%. Through the Logit Model based on the credit needs offarmers and family characteristics,the study found that rural financial credit marketdevelopment is immature in Henan, the market supply is not consistent with demand,and the family income, age, education level and other factors play important roles onthe choice of the credit channels. This requires relevant institutions to increasepropagandist strength, to pay more attention on credit suppliers’ needs to understandthe specific situation, and to conduct reasonable and scientific analysis, then to designsuitable develop program in Henan’s rural credit market. At the same time, thedevelopment of agricultural insurance does not fit the position of a big agricultureprovince by investigation, there’re many prominent problems affecting Henanprovince agriculture insurance market mostly because of lack of reasonable and perfect agricultural insurance system and incentive mechanism which led toenthusiasm of insured farmers’ is not high. There are leaks and malposition in ruralfinancial supervision as well.Based on this, this paper proposes that the objective and demand of establishing a ruralfinance service socialization system in Henan is to make it stable and efficient. Toachieve this objective and demand needs to build a establish reasonable and effectivefunds mechanism for mobilizing and allocating to ensure the equilibrium of supply anddemand in rural finance market, and scientifically manage the optimized configurationof financial resources and rural resources, and set up an interaction mechanism in ruralfinancial service system in order to balance market risk; to apply modern science andtechnology to enhance rural finance service level. Moreover, this paper said that it’sessential to ask for effective interaction in the rural financial system, reasonableleading and allocation financial recourse by local government, the supply and demandbalance in rural financial market.