Research On The Development Of Rural Microfanance In China

At present, the issue of agriculture, the rural areas, and farmers is the most crucial in China's sustainable economic development and building a harmonious society and the weakened rural financial support is an extremely important factor to influence the stability in the rural areas, the development of agriculture and the income of farmers. As a weak industry, agricultural has long been in a vulnerable market position, and the rural financial difficulties, difficulties in financing agriculture and farmers have been a major issue affecting the development of China's rural areas. Therefore, huge amount of funds is needed to support the building of a new socialist countryside. At this stage, although the Chinese government has increased the financial input in rural areas, due to the incomplete nature and vulnerability of the rural financial system new capital investment in rural areas is difficult to meet the huge demand. Microfinance, as a financial product innovation, is an effective means to increase rural funding to solve the problem of farmers'borrowing.Microfinance, as an outcome of financial innovation, its development phases follow the laws of financial innovation. That is, in China it has experienced four stages: the introduction of non-governmental organizations (NGOs), the imitation of government poverty-relieving departments and agricultural banks, national policies promoting rural credit cooperatives and to set up private microfinance companies,rural banks, small lending corporations and rural community credit cooperatives. The issue of Interest rates, the functions of the government, non-governmental organizations and the status, future development and the quality of personnel of rural microfinance companies is the key factor to constraint the smooth development of rural microfinance and rural financial innovation. At present stage, we should take the development of micro-credit as an opportunity to promote China's rural financial innovation. Through deregulation of the rural financial markets, the transformation of government functions and deepening the reform of rural credit cooperatives and other aspects, we can create a harmonious ecological environment in rural financial market and attract more funds to cultivate a diversified, competitive and orderly rural financial market.This paper mainly consists of the following four components: the first part explores the founding background and reasons and the development of rural microfinance from a theoretical point of view, and analyzes the developing process, the coverage and sustainability of China's microfinance from the practical perspective. The second part of the paper explains the operating mechanism of rural microfinance. On this basis, the third part of the article carries out a comprehensive and in-depth research on the development of commercialized rural microfinance in China, which is the core of the paper. The final part of the article deals with the perspectives of Chian's commercialized microfinance, proposes countermeasures, and also discusses the direction of its future development.