Develop Rural Credit Union Funds Based On Cooperatives

For a long time,"rural issue" restricting China’s economic development in rural areas, mainly because of the existing commercial financial system can not effectively provide adequate financial support. In order to strengthen rural financial institutions, the "rural issue" to support efforts of the State Council in the "deepening of economic reform on the2005opinion" clearly states that: explore the development of new rural cooperative financial organizations. In this context, farmers have established the "grassroots" cooperative financial institutions-credit union has been effective in rural development funds, which the local unit of self-help groups to some extent, solve the problem of the rural financial market dislocation of supply and demand. However, the operation of China’s rural credit union funds still in the preliminary stages of development, the organization will take the form of how the government should regulate the management in the future, in order to make sustainable development. This is currently the policy community and the practitioners of urgent study.The article first analyzes the development of the rural financial system and found that relying on the development of rural production cooperatives credit union funds have certain advantages. And then from the dual economic structure, asymmetric information theory, efficiency of oversight mechanisms and new institutional economics perspective, the article analysis theoretically. On this basis, with practice, the article selects the Taihu County, Anhui Jinqiao Tinyan credit union funds and union funds as a sample. From business performance, social performance and risk control mechanisms of these three proceed and two different modes for performance evaluation, the article found that Born within the Jinqiao rural cooperatives in the continuous mutual funds, social influence and risk control, even with the advantage. Finally, cooperation with foreign experience and the financial model of China’s rural economy made funds relying on the professional development of rural cooperative credit union’s routing and optimization of the external environment and of the internal operation mechanism made the rural credit union funds to develop normally...