A Study On The Impact Of China 's Microfinance On Rural Poverty Alleviation

With an innovative tool and a system, micro-finance provides financial services for the poor to get out of poverty. Since appeared, it developed rapidly, and its achievements were concerned by the academia. With the help of financial instruments and the innovation of system, micro-finance is providing sustainable financial services for the poor. As the main body of micro-finance services, its institutions use tools and innovative systems to help the poor to increase their income, to smooth their consumption, and to manage their risks. How about the development of micro-finance in China? What are impacts of the institutions to reduce the poor? What is the mechanism of it? All above these questions are important for the development of the micro-finance. We will discuss in the following essay.Firstly, the theory of micro-finance and poverty related concepts are described, which mainly defines the meaning of micro-finance and the classification of its institutions, summarized the theoretical basis of micro-finance, and analysised the effects of the micro-finance reducing the poor from the theoretical part. Secondly, the article talks about the current situation of poverty status and micro-finance development of rural areas, and diverts the ways of reducing the poor.On the basis,this paper, by using time series analysis methods and taking datas of Rural Commercial Bank during 1987-2012, tests the effects. The results show that, in the long term, the development of micro-finance promotes the alleviation of rural poverty, while in the short term, this effect is not obvious. Thirdly, this paper sorts out the successful experiences of micro-finance institutions both at home and abroad, as well as summarizes these successful experiences.Finally,combined with the conditions in China, this paper provides the policalrecommendations for the development of micro-finance in China.Innovative and practical significance of this study lies in the building on the impact of microfinance on the rural poverty reduction analysis framework and the empirical test of the effect of impact on rural poverty reduction of microfinance in China, and puts forward the microfinance poverty reduction policy Suggestions of our country.