Effects On The SMEs’ Debt Financing Costs By The Financial Ecology Environment And Bank Connection

Under the background of financial crisis, commercial banks enhance riskmanagement and control, SMEs with weak anti-risk capacity are the focus of theirlimits, and private lending with high interest rate and risk is just temporary reliefwhich results in disaster. Debt financing constraints for SMEs has long beenrestricting their further development. How to ease the financing difficulties of SMEshas been a matter of policy makers and scholars’ common concern. About alleviatingthe financing plight of SMEs, domestic and international theoretical researchersbelieve that innovation and development of the relational financing techniques and thefinancing environment are important solutions, and improving the financingenvironment would affect the impact of the relational financing techniques for SMEs’debt financing constraints. Via studying the effects of the relational financingtechnique, bank connection and the external environmental factor, financial ecologyenvironment on the cost of debt financing for SMEs, so as to provide reference forSMEs out of the financing difficulties.This paper takes SMEs board from2009-2012as research objects, brieflyreviews the financial ecology environment theory, institutional foundation theory, riskof information theory and the theory of credit rationing risk, then the effects on theSMEs’ debt financing costs by the financial ecology environment and bankconnection are expressed in detail; Based on detailed analysis of the close contactbetween financial ecology environment, the bank connection and debt financing costs,corresponding researching hypotheses are put forward. Then a multiple regressionmodel is built based on factors affecting the cost of debt financing, following, thefinancial ecology environment and the bank connection are the explanatory variables,at the same time, the debt financing costs is the dependent variable. Using thecorrelation and regression analysis of the relevant empirical data, empirical studiesshow that: the financial ecology environment associated with the bank connection hasa significant negative impact on SMEs’ debt financing costs, in poor financial ecologyenvironment the bank connection’s negative affection to the costs of debt financingfor SMEs is more significant.Finally, based on theoretical and empirical analysis concluded, policyrecommendations and suggestions focused on the financial ecology environment and bank connection are put forward, as well as the future prospects of the financingsituation of SMEs.