Research On Risk Regulation Of Rural Household Microfinance By Agricultural Bank Of China

Whether the issues facing rural areas, peasantry and agriculture can be solvedproperly will have an important impact on the sustainable development of the Chineseeconomy in the future. The report from the18th Congress of the Communist Party ofChina put forward three aspects as the top priority of the party work, including solvingthe issues about rural areas, peasantry and agriculture, promoting the integration ofurban and rural development as well as increasing peasantry s income. In order torealize this target, we need to accelerate the construction of a suitable financial system,which is adapted to the characteristics of the rural areas, peasantry and agriculture.Therefore, microfinance for peasantry will be an important way of the rural financialinstitutions to provide financial services for peasantry as well as building the rural creditsystem.A rapid development of micro-credit has been achieved since1990s in China,and China has been coming to the way of the exploration of “poor s banks” as DuXiaoshan created the well knew “poverty alleviation economic cooperatives”. Scholarsat home and abroad have already found that micro-credit could be an effective way forthe poverty alleviation though different comprehensive researches of micro-credit.These researches also pointed out that micro-credit could promote the development ofrural economy to a certain extent under the condition of solving the problems of creditrisks and asymmetric information that appearing in the traditional micro-credit.In1976, Mohamed Yunus, an economist in Bangladesh, started his Grameen Bankto offer the service of micro-credit, which has been an effective method for eliminatingpoverty and promoting social progress. The Grameen Bank as well as Yunus s conceptboth has very important implications for China. As micro-credit achieving a worldwidesuccess, Chinese government has been inspired to participate more in this field.Nowadays the increasing demand emerged on the rural credit, opening a door for the Agricultural bank of China to broaden its micro-credit business.As Chinese government once again endowed the responsibility of serving the“three rural” to the Agricultural Bank of China after its joint-stock reforming in2007,the ABC has constantly introduced innovative services to “three rural”, and amongwhich, a micro-credit for peasant household becomes its characteristics product.Therefore, this paper will devote more to the research on the sustainabledevelopment of the ABC s rural micro-credit basing on summarizing the foreignsuccessful micro-credit cases. In case study, the ABC of Linyi city will be an example tohelp revealing how could the rural micro-credit make a contribution to the explorationof rural market, increasing the income of farmers as well as promoting the developmentof rural economy.In this paper, divided into five chapters, the first chapter is an introduction to thefarmers through microfinance background analysis and literature review study abroad,combined with the local situation, leads to problems. Development Status chapter inLinyi City Branch of Agricultural Bank of farmers microfinance, through theintroduction of microfinance, microcredit leads in part on Rural Microfinance, ChapterIII of the Agricultural Bank of Linyi City Farmers Microfinance risk assessment.Mainly describes what small farmers credit risk, and the risk of Linyi City Farmersmicrofinance estimates and risk assessment, and through the hierarchical structuremodel and judgment matrix, summed up the risk factors in Linyi City Farmers majormicrofinance what. Chapter IV Agricultural Bank of Linyi City Farmers Microfinancerisk management and control. Over the research summary risk evaluation indexAgricultural Bank of China, the risks and causes of farmers produce microfinance risk,control risk through analysis gives some suggestions and countermeasures. Chapter Fiveconclusion. This paper summarizes the views and discussed and put forward their owninadequacies research.Nowadays micro-credit form the ABC is still a business dominantby the government in China. The advantage is that government could play an importantrole to put forward the development of micro-credit by issuing an increasing number ofhelp-the-poor loans. However, we are also thinking about whether the utilities offarmers micro-credit is strengthened or weakened under such supporting and control.On the other hand, we are still lack of a scientific evaluation system and which needfurther study and refinement.Date used in this paper is from material of non-comprehensive survey, which may lead some research to deficient. On the other hand, lots of mechanisms in China besidesthe ABC are also offering the service of micro-credit, but this paper only makes aselection of the influential ABC as the study case, other forms of micro-credit are notinvolved. Some further research should be made to solve this problem.