Higher Loan Risks And Their Control

It is because our country lays great emphasis on education and carries out the strategy of prospering our country through science education that there is an unprecedented chance of developing higher education in China. The number of students enrolling to all the institutions of higher education in crease sharply, so the scale of these colleges and universities expand quickly too. To achieve the strategy object of popularizing the higher education requires a huge amount of money. However, with a fixed state education funds investment, lots of higher education schools have to ask loans from banks to ease the shortage of money for development, and the amount of loan keeps increasing. Nowadays, running schools in debt has been a common phenomenon among the higher education schools in China.The experience of running higher education schools at home and abroad shows that raising a loan to develop a school is practicable. The loan could resolve the problem in developing higher education schools and ensure the development in a rapid way, making the schools get fine economic and social effects. But the schools need to repay capital with interest. So they should raise a loan in a timely and proper way, for it will leave the school much burden and affect their sustainable development if they are in too much debt. However, because of many reasons, the indebted schools of our country can't witness a favorable development; on the contrary, many of them confront more serious fund problems. Therefore, how to realize and solve financial problems has become a crucial matter for governments of all levels and school. According to this, this article is putting up a study on the cause and actuality of this problem and the truth of loan risk for schools.To conclude, the loan of higher education schools will surely produce some risks, so how to control these risks within their capabilities is the most important thing. Specifically speaking, the risks for such loan are the uncertain influences brought to the development and normal operation by higher education schools raising a loan from such commercial institutions as the bank. The factors for setting these risks include politics, economy, and systems and so on. In order to control the risks, we must consider many factors, such as the government, the education sector as well as higher education schools, keeping them under a proper scale by different approaches and measures.