Research On The Legal Mechanism Of Credit Risk Prevention Of Microfinance Companies

As a product of economic development in twenty-first Century,small loan companies play an important role in the development of the economy.The farmers and small and medium enterprises need small loan companies to solve the financing problem.Although from the pilot having been more than 10 years,due to the existence of a series problems-macroeconomic pressure,imperfect laws and regulations and internal poor management etc., small loan companies are facing unprecedented challenges.Firstly,the paper illustrates and analyzes the background, concept and significance of small loan companies.The author randomly selects a certain number of small loan company loan dispute cases,and summarizes the characteristics of this kind of cases in terms of the loan amount,the loan rates,guarantee forms and execution.On this basis,the paperan alysises the reasons for the frequent credit risk of small loan companies from outside and inside.At the end, combined with the time-background and the reasons behind credit risks,the paper puts forward several legal advice preventing credit risks pointedly and provides the theoretical support in order to further promote the effective development of small loan companies.