The Analysis Of Sme Advanced Payment Model Financing Based On Supply Chain Finance

SME is not only an important force in promoting China’s economic development, but also a significant ingredient of the national economic system. The healthy development of SME plays an important role in the development of China’s economy, the increasing of the employment rate and the optimization of the economic structure. However, it is reported that the second half of2011, nearly40%of the small and medium-sized enterprises face the difficulty that their capital chain maybe fracture, and they are struggling in the brink of bankruptcy. The number of all the small and medium-sized enterprises which registered in China accounts for99%, whose loan’s resource is less than20%. In order to solve the contradiction between SME and bands, supply chain finance emerged which could be possible solutions as the problems of SME financing. Supply chain finance can effectively alleviate the difficulties of SME financing through introducing the central enterprises of the supply chain and the third party logistics enterprises to enhance the level of credit for SME.There are three basic financing modes about supply chain finance—Accounts receivable financing, Confirming storage financing (Advanced payment financing) and Transportation and Warehouse financing (Inventory financing). Among which, Accounts receivable financing and Inventory financing are widely accepted in the world, and Confirming storage financing (Prepayments financing) is the characteristic product of the domestic bank’s supply chain finance. At the same time, during the operation of the model of supply chain finance, the core is that the financing risk of the enterprise could be meet the controlling objective of risk of the banks and other financial institution.There for, this paper studies Advanced payment financing as the main object and builds its risk assessment system. Aimed at the system, we assess the risk of advanced payment financing provided by the bank through the method of multi-level fuzzy comprehensive evaluation. And then based on the result, the pledging ratio of the Advanced payment financing can be obtained, that is, the loan’s risk of the bank and other financial institution can be reduced effectively to meet the controlling objective of risk by setting reasonable pledging ratio. The article also makes a comparative analysis of the model of advanced payment financing with the traditional financing. The results show that the first model can solve better the problem of the shortage of SME’s funds.Subsequently, based on the model of tripartite advanced payment financing, the article analysis the cost and benefit of all the parties involved in the model and further compare with the model of the traditional financing. The result shows that the model of advanced payment financing can enhance the income level of the parties, so as to create a win-win-win situation. Finally, on the basis of the previous analysis, the article propounds a series of policies and proposals which are in favor of the banks and other financial institution to carry out the financing business.