Smes Finance Research Of Japan

It has become a common phenomenon in most countries that small and medium enterprises accounts for 90 precent of all enterprises in one country. From the perspective of providing opportunities of employment, activating market competition and promoting economic growth, the major function of small and medium enterprises cannot be ignored. However, the financing difficulty has become a serious problem to those small and medium enterprises. Scholars from both domestic and overseas made large number of researches on the area of solving the financing difficulty, which restricts the development of small and medium enterprises; based on some relevant theories such as MM Theory, Weigh Theory and Life Cycle Theory, some deep studies have been made and more theories have been developed such as Credit Rationing Theory and theories of Bank-enterprise Relationship, and all those theories are developed to guide financing decisions made by small and medium enterprises.The number of small and medium enterprises in Japan, which is a representative of capitalist country and has the name of Enterprise Empire, account of 99.7 precent of all enterprises in Japan. According to < basic law of small and medium enterprises >, which is revised in 1999, small and medium enterprises are considered as “promoting economic vitality”, meanwhile, an new political idea of “promoting the development and growth of small and medium enterprises” has been proposed. The reason of the continuous development of small and medium enterprises in Japan is its sound financing system.In history of Japan, there are three stages in relation to its small and medium enterprises financing activities. First phase, Japanese government established Small and Medium Enterprise Agency and issued < basic law of small and medium enterprises > in 1948 and 1963 respectively, and then Small and Medium Enterprise Agency set up some relevant institutions that provide services to small and medium enterprises and issued some relevant laws and regulations which based on < basic law of small and medium enterprises >, therefore, an initial financing system in Japan had been established officially in 1960 s. Secondly, between 1970 s and 1990 s, large-scale enterprises in Japan no longer rely on bank financing due to their dramatic development, in order to keep operating and remain business, the focus of banks had moved to small and medium enterprises. Thirdly, in late 1990 s and so far, Japan has explored the direct way of financing and provided more credit guaranty for small and medium enterprises, therefore the middle and small-sized enterprises in Japan can make their rational financing decision from multiple financing choices that provided by its sound financing system. Japan has explored the financing method from traditional perspective, such as developed private placement bond, established JASDAQ market and encouraged relational loan. Moreover, Japan has made some efforts in an emerging financing way such as crowding funding, asset based loan and collateralized debt obligation. Those actions and steps made by Japan in order to improve the situation of small and medium enterprises are worth learning and considering. The fact that small and medium enterprises have a lot of disadvantage compare to large-scale enterprises, such as less capital fund, low return of investment, poor cash flow, lack of securities, result in high costs and great difficulties in financing. Thus, Japan has established relevant financing system, including relevant financial system, credit system and regulations and laws, which comprised a safety guard for the development of small and medium enterprises in Japan.The article is ended by pointing out the experiences and problems which has been gained and faced in the process of developing financing by analysing the situation of small and medium enterprises financing in Japan, then proposed relevant suggestions and advices in relation to small and medium enterprises financing by combining the real situations of China.