Research On The Influencing Factors Of Farmers’ Loan Guarantee

Farmers lack of development funds for production, but it is lack of loanguarantor or mortgage collateral from financial institutions. The difficulty in mortgageguarantee restricts the supply of rural credit. Farmer loan guarantee is an importantsubject to be solved. Thus this study focuses on the influencing factors in farmers’loan guarantee (including farmers, financial institutions and the external environment)and puts forward solutions to the problem in farmer loan guarantee. This study willprovide decision-making reference basis for improving the rural financial supply, givevaluable reference for realizing financial institutions’ economic benefit in thesupporting agriculture process, and can contribute to problem solving of farmer loans.The study closely studies about the issue of the farmer loan guarantee. On theone hand, this paper puts forward theoretical analysis framework of the factorsinfluencing farmer loan guarantee and make theoretical analysis about the possiblefactors influencing farmer loan guarantee through reviewing the existing literature. Onthe other hand, the study uses descriptive statistical analysis to explore the status ofthe farmers’ credit guarantees based on the two-level investigation of financialinstitutions and farmers. Then, the study conducts empirical analyses to identify thesignificant influencing factors in farmer loan guarantees from the perspective offarmers, financial, government and other entities through the establishment of themodel.This research uses the survey data about Fujian farmer and data from financialinstitutions and applies descriptive statistical analysis methods to obtain informationfrom financial institutions and the1736household survey questionnaire–based onwhich the study analyzes the current situation of farmer loan guarantee; it also usesliterature method and guarantee theory to examine factors that affect farmer creditguarantee. Through the survey data information gathered from the198credit expertquestionnaires and by the establishment of Sequential Model, this study analyzes thesignificant factors of farmer loan guarantee, and thus conducts quantitative empiricalresearch on farmer loan guarantee of influence factors. According to the study, financial institutions are currently active and innovativein exploiting farmer credit guarantee and in broadening the coverage of the guarantee.However, mortgage and pledge still are not available as main loan guarantee tofarmers. The major loan guarantees for farmers are farmer credit guarantee and creditloans. Effective security assets that farmers can provide are quite limited. Thus,vulnerable farmers groups are difficult to obtain the guarantee institutions guaranteeservice and hard to find a natural person guarantees. Farmers credit guarantees isinfluenced by the support policy and bank credit management policy from thegovernment, farmers own factors (credit farmers, farm household income, ruralhousehold assets, farmers’ personal characteristics, etc.), agricultural insurance, assetassessment and property rights registration system and so on. The Sequential Modelresults show that guarantees supporting policy, agricultural insurance, householdassets and farmer credit are the four factors casting significant impact on farmer loanguarantees. Accordingly, the study comes up with the conclusion that we shouldresolve the farmer credit guarantee problem by increasing the intensity of creditguarantee policy support and improving agricultural policy insurance, rural creditsystem and several aspects of the property system.