Research On The Supporting Capital Services Model For SMEs Based On The New OTC Market

With the national wide expansion of new OTC (over-the-count) market since the end of 2013, our multi-layer capital market system has been constantly improved. As a new sector, several aspects of the new OTC market has been paid a lot of attention to, such as the similarities and differences between new OTC market and the mainboard, SMEs (small and medium-sized enterprises) boardand GEM (growth enterprises market), the characteristics of new OTC market and how to treat the development history of new OTC market so that we can grasp its rules and promote its healthy development. In recent years, there is great downward pressure on our current economic situation. Meanwhile, considering the high operational risk, banks are relatively prudent when granting loans to small and medium-sized enterprises, which indirectly cause the difficulty of financing. There is a quite strong need for these rapid developing SMEs to gain financing directly from capital market. However, in traditional mainboard or SMEs board, high qualification requirements limit the listing of enterprises. Besides, the procedure is overelaborated with a high listing price which is hard to afford for SMEs when direct financing channels closed. The new OTC market largely takes the responsibility of providing direct financing channels for SMEs and helping them growing. It matters the overall situation of our economic and great expectations are placed on it.Based on the above background, this paper took the new OTC market and its supporting capital service mode as objects. We elaborated the definition, business scope, establishment background, and development process of new OTC market. Combining with related financing theories and the current status of new OTC market, we proposed "financing＋ listing＋private placement＋market making＋transferringboard" as a new OTC market supporting capital service mode, which including several steps, such as financing before listing, listing in new OTC board, private placement after listing, making market, and transferring board in the future. Moreover, we compared each steps with the mature capital market in details and found out two problems of the current mode andsolutions for the problems. We analyzed the social benefits of the new OTC market supporting capital service mode from three aspects, which were listed company, investor, andsecurity company. At the end of paper, we took Fundamental Films as the case and further explained the contain and effects of the new OTC market supporting capital service mode.As a conclusion, this paper confirmed that the new OTC market is a comprehensive platform offering supporting financing for small and medium-sized enterprisesand helping them growing. The new OTC market supporting capital service mode could yield benefits for either listed company, or investor, or security company. However, there are several problems existing in the current mode, we also offered the solutions. We hope the participants and supervisors of the new OTC market could gain benefit from this study.