The Study On The Crowding-out Effect Of The Proportion Of Long-term Loans To The SME Financing

Small and Medium-sized Enterprises account for99%of all main market playersin our country. They have made great contribution to the stable development of oureconomy, no matter it is based on social economy indicators such as corporate profits,tax contribution, realized export delivery value or the numbers of jobs they provided.However, despite the important role SMEs play in economy, they have a series ofproblems when faced with financing. At the same time, the proportion of long-termloans increased rapidly in recent years and become a major product in the market. Thecharacteristics of SMEs financing can be summarized as small, short, fastμ, and it isobviously different from the characteristics of long-term loans. Because long termloans are invested to Large or very large enterprises in infrastructure construction andmanufacturing industries, it is difficult to cover the low-level labor-intensiveenterprises. So it is even difficult for SMEs to finance under the double pressures ofthe increase of long-term loans and credit control. Therefore, research on long-termloans· crowding-out effect on SME financing has important practical significance.Firstly, this article investigates the condition of long-term loans and analyzed thefeatures of highly pro-cyclical, intensive investment and single market player. Thenresearch the correlation between long-term loans and SMEs by using the indicators likethe importance of bank credit to SMEs financing, maturity structure of SME financing,supply and demand of credit market and financing space of SMEs. Finally, this articleanalyzed the process of long-term loans· crowding-out effect on SMEs from the threedimensions of market interest rates, bank profits and regulatory constraints. By theanalysis above, this article theoretically elaborates the logic of long-terms loans·crowding-out effect on SMEs. In the empirical study part, this article uses the typicaltime-varying parameter model. At the end, some policy recommendations are given onthe basis of theory analysis and empirical results.The main contributions of this article conclude: Providing a new perspective forthe study of SME financing condition, and it turns out that the maturity structure offinancial institutions has a significant impact on SME financing; Clarifying the logicrelationship of long-term loans· crowding-out effects on SME financing; Thecrowding-out effects become more and more big because of the dominant long-termloans in our financial market.