Comparative Study On Rural Microcredit Mode Of China

This paper aims to use microcredit-related theory to analyze the present situation of development ofrural micro-credit market in China, focuses on the four kinds of micro-credit in China’s current model forcomparative analysis, points out a number of common problems, and put forward suggestions to promotethe healthy and sustainable development of micro-credit in China.Therefore, the author, from the perspective of the economics and management, by the methods ofpartial equilibrium analysis, comparative analysis, static analysis and dynamic analysis, based on thecurrent situation of the development of rural microfinance in China, analyses the current common problemsfrom three aspects of government, institutions and farmers, and summarizes the successful experience ofother developing countries in the international microfinance development.The study shows that, as a new type of rural financial tools, micro-credit is indeed a valid creditrationing, in particular, for the developing countries, the micro-credit to some extent relieves the dilemmaof “farmers difficult to obtain loans” and “banks difficult to credit”, and other issues, so as to promote thethe development of the rural economy. The pattern can guarantee effective credit to real poor farmers, andto ensure high repayment rates. As a result of20-odd years’ practice, the rural micro-credit market hasformed a diversified pattern with multilateral institutions’ involvement, a wide range of beneficiaries, anddifferent emphases on institutional design. But because the Government’s position is not clear, creditsystem is not perfect, risk-control mechanisms remain unsound, and some other reasons, the sustainabledevelopment of micro-credit is facing challenges.To solve the present problems, it’s very necessary to learn from international microfinance institutions,combined with the status quo of microfinance of China, thus we can put forward the feasible suggestionson policies. Specific measures in this study are as follows: to establish and improve the relevant laws andregulations, making status of microfinance institutions clear; to promote the construction of rural creditsystem, advancing the formation of good credit environment in order to protect the interests of creditors; toimprove the management mechanism of credit institutions for sustainable development of its own.