Research On The Risk Of Private Lending Financing In SMES

With the deepening of reform and opening up,the market economy gradually occupies a dominant position,accompanied by the development and growth of private SMES.But for a long time,due to financial repression and information asymmetry,SMES have been unable to get financial support from formal financial institutions,and SMES have turned their financing perspective to private lending.Private lending is a financial form independent of formal commercial Banks and plays an important role in the financing of SMES and residents.But as a result of the folk lending has the characteristics of concealment,high interest rates,lead to the regulation of private lending is difficult,leading to the risk of corporate borrowing process,sometimes lending to small and medium-sized enterprises in while ignore the risks,and even lead to capital chain rupture.This paper analyzes the risks caused by SMES use of private lending and financing,so that enterprises can find corresponding countermeasures to deal with the risks.Aimed at the problem in this paper,through literature analysis and case analysis,the domestic and foreign literature,folk financing theory discussed,classification,and summarizes achievements obtained and the lack of points out,describes the present situation and this kind of financing way of private lending to the risks of enterprise,research and analysis how the folk lending to the small and medium-sized enterprise financing risk,finally according to the analysis of the causes of the financing risk,respectively from the level of private lending,businesses,government,for the company and private borrowing strategy and Suggestions are put forward.This paper has three main contributions.First,different from previous studies,this paper focuses on the risk prevention of private financing by SMES.Secondly,we should conduct an in-depth study on a small and medium-sized enterprise,reasonably use the private loan funds,and realize the effective improvement of enterprise market value.Third,the risk prevention measures of private lending are given,which have strong operability.