Risk Management And Control Of Credit Loan For Small And Micro Enterprises

In recent years,China has stepped up efforts to promote financial inclusion,with the aim of making the financial sector better serve the development of the real economy,accelerating the pace of sustainable economic development and realizing inclusive growth.This is an inevitable requirement for building a moderately prosperous society in all respects.To develop inclusive finance,we must strengthen financial services for small and micro enterprises.Small and micro enterprises are an important part of national economic development,conducive to the prosperity of the economy,by improving people’s livelihood,creating jobs,and promoting social progress.Therefore,they deserve to be one of the important target of inclusive financial services.As for Agricultural Bank of China(referred as ABC hereafter),to provide financial services to small and micro enterprises and support their healthy and rapid development is not only a social responsibility that a large state-owned commercial bank must undertake,but also a significant step in the long-term development of inclusive finance.However,it is undeniable that the development of small and micro enterprises at the present stage is still facing many challenges such as high credit risk,high credit cost and low capital return.Therefore,it is imperative for ABC to achieve a higher level of risk management and control of credit loans for small and micro enterprises.As ABC is trying to develop and expand its credit loan sectors to small and micro enterprises,it should always bear in mind the three fundamental HOWs: how to reduce the credit risk,how to improve the credit management level and how to improve the profit space.ABC JW branch has been adopted to be the target for this case study.This case study is based on the actual status quo and challenges of ABC JW branch,in terms of the risk management and control in their credit loan sector for small and micro enterprises.It conducts an analyses of current situation and problems in the risk management and control of ABC JW branch,and it also tries to shed light to those more mature risk management and control systems from an international perspective.With the guideline of a fuzzy analytic hierarchy process(AHP),this case study eventually tries to construct a risk evaluation model for ABC JW branch.The core theoretical basis for this model is the algorithm of fuzzy analytic hierarchy process(AHP),which gives each layer of index a particular rating of weight.Through data analysis,this case study aims at building a better risk management and control system in the credit loan sector of ABC JW branch,through the following steps: to enhance the risk management and control of credit loan sector for small and micro enterprises,to establish a proactive early warning mechanism for risk control,to upgrade the approval management of credit loan sector,to improve the professional skills of the credit loan staff members.It is our hope that this case study could help ABC JW branch to achieve steady and rapid development of credit loan sector for small and micro enterprises,so as to respond to the call of national policies,and to support the development of inclusive finance with our financial resources.