Microfinnce Company’s Legal System

Microfinance Company mainly refers to providing small amount credit services for low-income people and objects. The company has a perfect small loans in rural financial system, and promote the economic development of "agriculture, countryside and farmers" action, have "poverty alleviation" public benefits. Microfinance companies operating small loan business, can create income, through the interest income to maintain the normal operation of the company, and also with commercial.In recent years, the microfinance company of China gets fast development. May25,2011in the China banking regulatory commission issued a commercial bank support further improvement notice of small business financial services, a small loans to guide the development direction of the company. The microfinance company’s fast development help guide the flow of folk capital, regulating private financing, maintain the social stability of our country, on our country’s economic development have a positive effect. At the same time microfinance company procedures convenient, lending quickly and so on the advantage for better rural and small and medium-sized enterprises provide loan services, which can effectively solve the problems financing difficulties of small and medium-sized enterprises, and gave birth to the new mode of economic growth. But this new to try also to the traditional financial legal system has had a huge impact.But there are many obstacles at present the development of China’s microfinance company, mainly for:First, our country about microfinance company on the relevant legislation has deficiencies; Second, it is the legal status of microfinance company of provisions is uncertain; Third, the supervisor main body and content is not clear; Fourth, the company capital source a single, financing costs too much, are overweight taxes; Fifth, the company operation are in default risk, money laundering, regional risk and financial risk; Sixth is the company employees professional quality is not high and the internal management agency setting not science. To solve these problems, in combination with China’s specific conditions and other countries for reference of microfinance company, especially the Bangladesh rural bank and the people’s bank of Indonesia. First strengthen legislation, make up for the lack of relevant legal basis at present situation, through the legislation of microfinance company status, supervision system for main body confirmed. Second, the perfect small loans company supervision system, supervision and regulation clearly subject content. Again, in the strict control over the foundation of the company operating risks to break through the existing system of microfinance company funds limit. Finally, improve the professional quality of employees; make small loans to the management of the company more scientific.