Factors And Countermeasures Of Credit Risk Of Rural Credit Cooperatives In Case Of Rural Credit Cooperatives Of Hengyang County

As the banking institution, rural credit cooperatives provide financial services to "three rural", and its main function and business is credit, which means rural credit cooperatives would provide financial services directly to the society.The borrowing behavior that is determined by the nature of the credit, and loan capital limited by various factors would influence the capital repayment, as well as the default on loans caused by subjective intention of the borrowers would result in credit risk. As most of the lenders are small and medium-sized enterprises or individual farmers, who mostly are weak of anti-risk, such characteristic of lending targets and scopes would lead credit risk to remain high. Agriculture related industry is easily influenced by nature conditions, which is different from non-agricultural loans. There are other factors that would also expanse the credit risk, which include incomplete market economy and legal system, poor credit awareness of individual corporate, the intervention of local government on rural credit cooperatives, faulty agricultural insurance, the weak operation and management of rural credit cooperatives on credit capitals, extensive management, etc.It is such a lot of internal and external factors, which are subjective or objective, systematic or non-systematic that cause accumulating a large number of issues on risk management of rural credit cooperatives. Under such background, this article will try to analyze the factors that cause credit risk of rural credit cooperatives in deep, and provide recommendations to resolve and control risk by learning from the mature financial theories of domestic and foreign workers, scholars, hoping to offer reference views on credit risk management of rural credit cooperatives in the period of transformation.