Research On Formalization Of Xiang-xi Informal Finance

Non-governmental Finance engendered a long time ago. It stored not only in a particular country or region, but throughout the majority of developing countries, as well as some developed countries. Non-governmental Finance has dual effects on economic development. First of all, in the positive sense, Non-governmental Finance improves efficiency in the allocation of funds and functions, At the same time,it is a complementary for the formation of a state-owned financial system; in the negative sense, it impacts national macroeconomic and financial policies, the economic policies, the economic development and social stability, its negative influence cannot be ignored. China is one of the large developing countries whose civil-monetary issues is very conspicuous. Therefore, there is a theoretic and realistic significance for China to be conscious of the importance of how to use Non-governmental Finance for the profit and avoid loss.Hunan Xiang-xi financing events, which has representativeness in China's history of non-governmental financial development process for its manifestation of the social attitudes and institutional deficiencies in the whole process. In this paper, author get logical analysis, experience, supply and demand analysis and other methods, combined with the practice of private finance in Western Hunan, examining the development of western Hunan private banking standardization issues, deep-level mining nongovernmental financial problems and putting forward development strategy .This research concentrates in the following aspects: First, overview the the literature of financing of small and medium enterprises and private finance, and gives the author's concept of civil financial insights and definitions; second,give a direct cut into the western Hunan folk illegal the typical fund-raising case and an analysis of its adverse effects; third, the main cause of financial anomie private finance in Western Hunan is a big gap between supply and demand and the vacancy of local governments in guiding the process; four, it connects economically developed countries and regions, and our practice, to further improve the fit of SME financing, private banking put forward policy recommendations.This study shows that private finance borns in the system under the dual role of supply and demand, as the induced institutional innovation, the negative effects of non-standard of non- governmental financial development are multi-faceted, multi-level, from the micro-level,it is not conducive to small and medium enterprises financing; from a macro perspective, it will make the central bank's monetary control more difficult. In this paper, the author proposes the following advices: First, optimize the development of private financial standardized system environment; 2 is a Private Finance to conduct effective supervision, mainly the establishment of information disclosure system and play the role of the government's macroeconomic regulation and control; third, of funds from the supply side and demand-side for self-improvement.