The Research Of Chinese Rural Informal Finance

With the continuous development of our economy, the rural economies developquickly. Due to historical and social reasons, China’s rural financial shows differentcharacteristics from city finance, the economic phenomenon of informal finance.Informal finance is in private borrowing, pawn mortgage as the representative of thefinancial market, from the legal or regulatory perspective, non formal financeorganization is not completely by the laws and regulations of national financial policyand legal support, financial supervision edge but free from government.Through the general introduction of informal finance, we can clearly understandthe definition of non formal finance; informal finance and the theoretical foundationof the formation of informal finance and the phases, morphology, the main reasons,play a role; after understanding the basic content, we can make a prediction and thereasonable judgment for the future development trend of informal finance.The development of rural economy in China has different characteristics and cityeconomy, the economic effects of different. But we are concerned about the featuresat the same time, we should also see vested interest set, the existing laws andregulations as well as the microcosmic main body lower overall quality of rural nonformal finance to control the.The development of China’s rural non formal finance, the final is to changetoward normal direction, which helps to reduce the risk of default, promotingfinancial system reform, stable macroeconomic environment. But in this process,there are many factors, such as the mainstream ideology cannot promote thenormalization of informal finance, rural financial regulatory imperfections hindernormalization of informal finance, high-end human capital scarcity limits the ruralnon formal finance standardization etc.. Although there are certain constraints, but therural non formal financial normalization or have a driving force for internal andexternal, promote the standardization process of informal finance in china. In the path of China’s rural non formal finance regularization of the selectionprocess, first of all, we should guide the development of rural non formal finance, sothat the development of rural non formal finance system innovation, introducingscientific credit evaluation method, cultivating social credit concept; secondly, weshould change the rural non formal financial operation mode, so that the rural nonformal finance to the formal financial mode conversion, conversion and formalfinancial link mode; third, we should put forward specific opinions and suggestions,and strive to strengthen the legal regulation, reduce the informal financial transactionrisk; the reform of rural finance, the integration of formal and informal finance market;to encourage the non cooperative formal financial market with the formal financialmarket development.