Research On County And Village Banks Serving "Agriculture, Rural Areas And Farmers"

As a new kind of rural financial institution, county and village banks were set up at2007, toserve “agriculture, rural areas and farmers”. As rural fund was generally considered betransferred to cities and towns, market positioning deviate from serving “agriculture, rural areasand farmers” was existing when county and village banks supply financial service. Introduce thebackground of the establishment of the county and village banks as the beginning of the thesis,then expounds the development process of China’s rural financial system, so the developmentstatus and existing problems are understood by contrast the development of foreign ruralfinancial system. This thesis further applies SCP paradigm to analyze the structure of China’srural financial market, the conduct of county and village banks and compare the performance ofmain rural financial institutions for researching the problems in serving “agriculture, rural areasand farmers” for county and village banks.Based on the limited data, we found that rural financial market faced by the county andvillage banks was an oligopoly market with high degree of market concentration, product in thismarket had no obvious difference, and entry and exit barriers were high. County and villagebanks adopted a series of positive conducts in order to based on the rural financial market andstrive for more market share. But from measurement for performance, the county and villagebanks do deviate from serving “agriculture, rural areas and farmers”. According to theconclusion of SCP analysis, we believe that as a commercial financial institution, it’s inevitablefor county and village banks to deviate from serving “agriculture, rural areas and farmers”. Andself-sustaining asks county and village banks to profit. In order to develop better, so as to returnto serve “agriculture, rural areas and farmers”, the deviation is necessary for strategicadjustment.Finally, according to the business and policy, give some related suggestions based on how toenhance the profitability for the business and how to promote the returning of serve “agriculture,rural areas and farmers” to meet the policy.