The Research On The Demand And Supply Of Rural Consumption Credit On The Basis Of The Rural Consumption Escalating

During the process of enlarging domestic demands, the development of rural consumption credit has become an urgent demand of rural consumption escalating.The demand for consumption credit is a kind of induced demand; firstly there should be the demand for consumption. Rural consumption consists of productive consumption and household consumption. The expenditures of rural residents on productive consumption and household consumption are for different purpose, so the demand of consumption credit for these two parts observes different decision mechanisms. New rural construction will promote the household consumption of rural residents through 3 different conduits. From the contribution of production factors to the difference of inter-provincial agricultural output, we know that so far most regions of our country are dominated by labor-intensive agriculture. Formal financial institutions should adapt its credit support for agricultural productive materials to the need of local production, in accordance with local production condition.A well functioned financial system is important precondition for the development of rural consumption credit. In order to satisfy the legitimacy and make full use of existing financial resources, it is still necessary for the traditional formal financial institutions to play a main role in the provision of rural consumption credit. The profitability of rural consumption credit is precondition for traditional formal financial institutions to provide rural consumption credit. The cost of providing rural consumption credit due to the features of the institutional design of the financial institution and the extend to which it can adapt to the rural credit environment. Because the cooperation between formal and informal financial institutions may do well to both parties' problem of sustainability, in resent years the cooperation between formal and informal financial institutions has become a new feature of rural credit market in developing countries. China's rural consumption credit market is still characterized by the features of traditional rural credit model, which makes the cooperation between traditional formal and informal or newly-created financial institutions become an operable way in the effective provision of consumption credit.