Research On Microfinance Risk Management In Shandong Province

Compared with the developed countries and the developed areas in China, capital market less developed in shandong province, which provides smaller support.The small enterprise financing comes from indirect financing rather than direct financing in Shandong province. As a big agriculture province in our country, microfinance has broad space for development and prospects in the province of shandong. Micro-credit as the most important part of inclusive finance came to China in 1990 s and chose the rural area as the pilot site.It has developed rapidly in China. According to the investigation, small and medium enterprises financing funds originate from formal financial institutions. Rrural credit cooperatives(including rural cooperative Banks, rural commercial Banks), Village Banks and Small loan companies are the mainly institutions which provide microfinance. In addition, various kinds of policy Banks, state-owned commercial Banks, joint-stock commercial Banks and local city commercial Banks have also set up small micro enterprise service center and agricultural service center, these institutions will be a part of the attack can not be ignored in the microfinance business. Until the end of 2013, the number of the legal person institutions in our national banking financial institutions is 3949, with 3550000 staffs. It has established 1050 new rural financial institutions, which include 987 village banks, 14 financial corporations and 49 rural fund cooperation societies.Based on these, this paper chooses the Shandong province as the research object and analyzes the micro-credit risk which is the most important part in inclusive finance.The paper has six chapters. The first chapter is introduction. It will mainly introduce the research background, purpose, significance. In addition, the literature review about the micro-credit and the basic framework of the paper will also be given in this chapter. The second chapter will summarize the relevant theories. One the one hand, the definition and features of micro-credit will be given in this part. On the other hand, the relevant definition and theory about risk management will also be shown in this part. All of these will make the foundation for the discussion in the next part. The third chapter will make analysis the micro-credit risk situation in Shandong province. Firstly, current development situation of micro-credit in China will be given, then the specific introduction of micro-credit development situation in Shandong province will be shown according to investigations and surveys. Finally, this chapter will analyze all kinds of risks micro-credit is facing in Shandong province.chapter four is about empirical analysis. Firstly, the model will be determined. Then set the index with the help of expert judgment method. Build the model according to the index and conduct the empirical analysis and find the elements which will have great influence on micro-credit default. Chapter five will give the relevant suggestions and measurements according to the analysis of micro-credit risk situation in Shandong province and micro-credit experience from foreign countries. Chapter six will serve as the conclusion.