Welcome to free paper download website

Of SME loans Causes and Countermeasures

Author: CaoGuiFang XuKun From: www.yourpaper.net Posted: 2010-03-05 12:04:25 Read:

Paper Keywords: small and medium-sized enterprises; loans; causes; countermeasures

Abstract:
SMEs in social development plays an important role, it is the lifeblood of the economy, creating jobs and improving people's livelihood important carrier, however, small and medium enterprises has been troubled by the difficulty in obtaining loans. Based on this starting point, the analysis of the causes of SME loans, to improve SME loans countermeasures.


the causes of SME loans

SME loans for many reasons, the main factors of government banks factors and corporate factors three reasons.
Governmental factors
(1) The functions of the government role to play enough
Government functions play enough is mainly reflected in: First, the Government is not enough standardized management for SMEs, such as education and training for SMEs leaders and staff; practical protection of the interests of the competitiveness of SMEs, local legislation; of SME files and credit system established and so on. Almost no local government to regulate. The second is to guide is not enough, such as SME development strategy, industry to invest in guides, product market information, information resources network, the local government did not provide SMEs. Third, support is not enough support is mainly reflected in the guarantee support, interest subsidy support, loans, tax support.
(2) The intermediary social security system is imperfect
SME loans, largely because the lack of effective credit guarantee. Although the Government in recent years concern loans to SMEs, but the effects of the operation of our existing guarantee institutions is not ideal, the intermediary functions there is a big limitations. First, the operating mechanism of the guarantee institutions are imperfect, not only restricted the expansion of the capital, the capital of civil society can not enter this market and product administration runs sluggish.
2 banks factors
(1) risk
Modern commercial bank operating principle is "nature", namely the "safety, liquidity, effective. The bank's primary goal is safety, liquidity and profitability, the high rate of closure of small and medium enterprises, however, the high default rates makes it difficult for banks to comply with the principles of safety and profitability, leading to difficult for banks to lend.
(2) information asymmetry lead to commercial banks have alienated SMEs
Banks at a disadvantage in the market Boyi shy away from lending to SMEs. Loans to SMEs in the most important feature is the lack of transparency in financial position. In comparison, large enterprises, in particular, the operating conditions of the listed companies, financial information and other information on the degree of openness is much higher than small and medium-sized enterprises, and the true extent of the information should be higher than SMEs. In this case, banks willing and large business loans rather than to small and medium-sized enterprises.
(3) Commercial Bank SME credit rating lower
Due to the inherent characteristics of the SMEs in the credit rating the evaluation usually scoring rate is very low: First, small-scale, low market share, sales revenue and cash flow is difficult to determine the stability, reliability is not strong source of repayment funds. Their funds is limited, long-term solvency and short-term solvency weak, not strong level of protection for bank debt. The financing already weak ability to obtain financing cash flows, bank capital injection leeway. In addition, due to the limitations of the financial statements of SMEs, the bank through the establishment of the financial statements on the basis of analytical techniques have significant limitations, the bank is difficult in a short period of time given the ability to credit for SMEs give an accurate, objective evaluation.
. Factors
(1) owner (manager) professional ethics
Some of the small and medium business, get a lot of high investment or bank loans, not concentrated business enterprises, to enable investors to get the bonus, the bank loan principal and interest, but take ant, or taken to cover up the flight of money, transferred to the field, or even abroad, and then fled away, so that investors lose everything, bank debt collection nowhere. Study the root causes of social realities, one based on public ownership of the traditional mode of thinking, is the low level of productive forces in China, some small and medium-sized operators unscrupulous, contrary to the rules of the market.
(2) The financial data is not real
Some small and medium-sized enterprises in order to get the investment and loan funds, investment and loans by providing false figures, feel difficult to check these false figures in the financial statements of the investment and loans are difficult to identify, thereby increasing the risk of investment and loans. According to the survey, more than 50% of the financial management of SMEs in China is not perfect, many SMEs lack enough by the financial audit department acknowledges the financial statements and continuous business records.

SME loans Countermeasures

Loans for SMEs to various reasons, from the perspective of government, banks, enterprises themselves, comprehensive have to be improved to be able to solve the difficult problem of SME loans. In this paper, the following aspects countermeasures:
Play the positive role of government to improve SME lending environment
Government departments should strengthen the guidance for SMEs to help them improve their own quality. In the continuous spread of the financial crisis, the government departments, especially to strengthen the construction of soft environment, and vigorously support the development of small and medium-sized enterprises. It should be said, to create a favorable financial environment is a necessary condition to solve the difficulty in obtaining loans for SMEs. Government departments should be committed to the construction of social credit environment, and strive to create "honest government" and "honest society.
Commercial banks to improve credit services for SMEs, strengthen credit support to SMEs
In the context of the current international financial crisis raging in the world, China's commercial banks in the pursuit of profit at the same time, it should contribute to the community responsibility to help our economy as soon as possible to get rid of the financial crisis. Commercial bank shall establish a management model to adapt to the characteristics of SMEs, such as the establishment of the SME Division, the establishment of flexible entry and exit mechanisms for SMEs; strengthen credit management for SMEs, and improve services for SMEs; focus adapt to small and medium-sized enterprises credit assessment and credit and loan approval system.
SMEs to improve their quality of operations, and enhance the concept of credit
SMEs should strengthen self-construction of credibility, enhance the management level, to grow their own economic strength. To establish and improve the property rights clear, accountable, management practices, open and transparent sound corporate governance structure and internal control system, effectively protect the integrity of our assets, reduce fraud behavior. SMEs to constantly improve their own quality, to promote the adjustment of product structure for SMEs. Establish a good financial system to increase the transparency of corporate finance, at the same time actively establish information exchange mechanism with financial institutions. Strengthen the concept of credit, improve conscious repayment awareness, to maintain a good relationship between banks.

References:
[1] Shao Wei: the SME loans Causes Analysis and Countermeasures [J]. Foreign investment in China, 2008.
[2] Luozheng Ying: studies on the financing problems of SMEs [M. "Beijing: Economic Science Press, 2004.
[3] Deng Shaohua: Reflections on the financing of SMEs, the financial economy, 2006.
Please consciously abide by Internet-related policies and regulations.
Tips: Log in to comment, the user name to enter comments directly from your personal space, so that more friends to meet you.

Company Research latest papers

Sponsored Links

Company Research papers Ranking

Latest free papers

Sponsored Links

Top