Research On Causes And Decision-making Of The Financing Difficulty Of SME

SMEs play an important role in the development of the national economy and possess a wide range of social and economic foundations.Both in developed and developing countries,SMEs have absolute advantages in terms of quantity.Compared with large-scale enterprises,SMEs are more flexible and active.They can effectively cooperate with large-scale enterprises and have important significance in terms of cost savings and risk reduction.SMEs are large in scale and play an important role in promoting economic development,increasing job opportunities,and accelerating technological innovation and development.However,SMEs face many problems and difficulties.Financing difficulties are one of them.Compared with large-scale enterprises,SMEs receive less financing,high interest rates,and more restrictions,while internal financing has more natural shortcomings.This,combined with the lack of SME financing awareness and financing plans,has severely constrained the development of SMEs.The financial services obtained by China's SMEs do not match their contribution to the national economy.The study shows that the causes of SME financing problems can be analyzed from the perspective of law and policy,the perspective offinancial institutions,and the perspective of SMEs themselves.From the perspective of law and policy,China has not yet established a comprehensive legal and regulatory system to protect the financing of SMEs,and the financing threshold for China's SME capital market is high.Many SMEs cannot obtain financing through the capital market.Most financial institutions have credit discrimination against SMEs,and China's credit guarantee and rating system is not perfect.Financing for SMEs is not cost-effective,therefore,financial institutions are not willing to lend to SMEs.From the standpoint of SMEs themselves,weaker competitiveness,difficulty in getting bank approvals for collaterals and pledges,poor credit status,and weak corporate finance awareness all exacerbated the financing difficulties.SMEs themselves need to improve the level of operations and management;strengthen the construction of their own credit systems and increase their creditworthiness;and step up efforts to promote product innovation and service upgrades.The study believes that if we want to solve the problem,we must start from the three aspects of laws and policies,financial institutions and SMEs,and carry out corresponding reforms.In terms of laws and policies,it is necessary to establish and improve a targeted system of laws and regulations for SMEs;to introduce policies to support the development of Internet finance;to increase government support.In terms of financial institutions,we must earnestly implement inclusive financial policies anduse technological means to improve the efficiency and effectiveness of serving SMEs;we must promote mutually beneficial cooperation between guarantee agencies and financial institutions of SMEs;we must regard the development of supporting SMEs as a long-term strategy.The innovation of the article lies in the selection of M Enterprise as a case to study how M Enterprise makes financing decisions and realizes its own development.The financing of M Enterprise is aimed at the financing of the industrial chain,which not only enhances its own financial strength,but also broadens its downstream sales channels.The article elaborates on the selection of financing channels and the specific case analysis.On the choice of financing channels,we analyzed macroeconomic conditions,industry conditions,and company life cycles.In specific case studies,we clarified the determination of M Enterprise investors,the improvement of internal management mechanisms,and the main processes and impacts of equity financing.