Research On Credit Risk Management Of Micro - Credit Companies Based On AHP Model

Based on the generation and development of micro-credit and the sort ofmicro-finance institutions in the global credit risk management studies find thatfinancial credit risk management model that there is a qualitative management toquantitative management， from simple competent to objective mathematicaloperations. However,to micro-finance institutions，the management of credit risk isfar from advanced theories, especially to those micro-finance institutions, because ofthe shortage of the talents, management is very confusing.When micro-financeinstitutions develop loan business, they mainly rely on the subjective qualitativeassessment of loan officers, which will cause a lot of problems, for example, loanofficers relax loan conditions in order to improve their performance；loan officershave different levels which will make different standards; And in order to guarantee acertain quantity and quality of loan officers which will lead to costs increased and soon. These problems which faced by micro-finance are very important to be solved.Therefore, control of micro-credit risk, particularly credit risk,reduce bad loans,improve credit quality has become a very important task of micro-credit lendinginstitutions.At this moment,we need an evaluation method of quantitative analysis to solvethe shortcomings of traditional qualitative analysis method.After the introduction ofAHP credit risk assessment model, in the conduct of lending, loan officers mustcollect customersˊdata, and then use the AHP credit risk assessment system toassess the credit risk, the value we obtained should be compared with the referencevalue, at last, according to the size of the comparison value to determine whetherlending and how much to lend.Using the AHP model to assess credit risk when wemake credit decisions is very simple, easy, fast and efficient,because this credit riskassessment system is impartial and objective,but this model also has somedrawbacks.With this article,we will summarize the lack of the model and propose solutions.In accordance with the present situation and characteristics of economic and financialdevelopment of Chengdu, using this model to text local Emes and individualindustrial and commercial households’ performance of AHP credit scoring.