On The Legal Regulation Of Small Loan Companies

In recent years, the state-owned commercial banks to set up outlets in rural areasfor a certain degree of cancellation, financing more difficult. At the same time, somebanks only big business, but refused to give small businesses the sun and rain.In thisenvironment, capital has seriously affected the three rural and small and microbusinesses fast, healthy and sustainable development. Our company was born inmicrofinance private lending activity, SME financing under strict financial regulationand financial environment, it is a way to produce the "three rural" and small businessfinancing, both the efficient allocation of financial resources, but also the promotion ofagriculture, farmers, rural and small enterprise development, promote rural financialreform. However, there are many legal issues microfinance companies exist in theactual development.Small loan companies rank lower regulatory law, legal position isunreasonable, regulatory body set unreasonable regulatory standard settingunreasonable, and low internal capacity. Potential risks are not conducive to the steadyoperation of microfinance companies, is not conducive to a stable financial order. So asto control the risk of these problems arising, improve the legal regulation of small loancompanies is necessary. Perfect small loan companies control laws and regulations,improve the regulatory system, and improve access to exit the system, improveoperational monitoring system, improve the regulatory measures are related auxiliarybeneficial move.This paper consists of four parts, The first part analysis basic problems of smallloan companies. Microfinance company first introduced the generation anddevelopment of small loan companies and then introduced the concept and positioning,and finally from a legal point of view to make a small loan company analyzes thenecessity of legal regulation. The second part of the empirical analysis method, basedon the introduction of the regulatory status quo, summing up our legal and regulatoryproblems of small loan companies. First, the legal regulation of low rank. Second, thelegal position is unreasonable. Third, the regulatory body set unreasonable. Fourth,regulatory standard setting unreasonable. Fifth, poor internal controls. The third part ofthe method of comparative analysis, by introducing Bangladesh, Indonesia, the UnitedStates of mature regulatory practices and experiences, draw inspiration to China. Thefifth part is to explore methods of improving the use of legal regulation of microfinance recommendations. First, improving the small loan companies control laws andregulations, with particular attention regulatory principles and legal position clear andaccurate small loan companies. Second, improve the regulatory system. The third is toimprove access to exit the system. Fourth, improve operational monitoring system. Fifth,improve regulatory measures. Six is to improve the regulatory system related support.In this article, bold innovation, through domestic and international theory, practiceanalysis, absorb the useful experience of other scholars proposed innovation, is to builda special regulation, market regulation and self-regulation. raising wholesalemicrofinance company’s soft constraints regulated market, relying on financialinstitutions and market forces to determine and prevent risks. The full text relatedsystems by improving the sound of measures to provide a sound legal environment forthe sustainable development of small loan companies.