Appraisement And Sustainable Development Of Peasant Household Micro-finance

Peasantry, countryside and farming is a main problem that obsessed the sustainable, rapid and healthy development of Chinese economy, which is closely related to the underdevelopment of micro-finance of Chinese rural credit association. Back to the early 60s of the 20th century, the earliest practice of micro-finance business was conducted in the Grameen bank in Bangladesh by Muhammad Yunus. Back to the early 90s of the 20th century, micro-finance was first introduced as a poverty reduction strategy into China. The U.N stipulated that the year of 2005 belongs to Micro-finance. In 2006, Banglade Grameen bank and Muhammad Yunus awarded the peace prize of Nobel .Since then; we have been learning from other countries' successful experience in micro-finance and practicing micro-finance in our country. The Chinese government paid special attention to the effect of micro-finance in poverty reduction. The People's bank of China has been conducted micro-finance through out the country since 1999. To solve the problem of "difficult to access credit" for the peasant and "difficult to lend credit", while at the same time keeping an efficient development of the rural credit association, the sustainable development of the peasant household micro-finance business of the rural credit association is now on the agenda.This article mainly investigates the practice of peasant household micro-finance business of the rural credit association. This article places importance on two aspects especially: First appraises the impact of peasant household micro-finance , Theoretical study and practical analysis proved that peasant household micro-finance not only increases the earnings of peasant but also keeps an efficient development of the rural credit association; Second, taking into account the problems of peasant household micro-finance in our country, it is urgent for the government to take effective ways to ensure the sustainable development of peasant household micro-finance business from rate ,demand and supply, venture prevention .The full article is divided into six chapter: Chapter one introduces the background, the purpose and the significance of the research, the paper's structure, the method and the mail content of the research, Based on domestic and foreign scholars' studies about micro-finance. Chapter two first reviews the generation and development process of micro-finance in the world and China; second introduces general conception and principle of peasant household micro-finance such as the rural credit association, peasant and credited countryside, third expounds the process of peasant household micro-finance of the rural credit association. Chapter three simply introduces the theory of the sustainable development of the peasant household micro-finance and examines the academic feasibility and basic factor to promote sustainable development of the peasant household micro-finance business in China carefully.This article places special importance on Chapter four and Chapter five. Chapter four first expatiates that the rural credit association has superiority in conducting peasant household micro-finance business, Peasant household micro-finance is a financial innovation, and it improves the credit relationship in rural areas, resulting in micro incentive effects and macro growth pushing force. Then empirical analysis of 2002—2005 provinces' data through the method of two-way fixed effects panel model shows that peasant household micro-finance promotes peasants' family income and has significant effect on poverty reduction.Chapter five takes into account the practice of peasant household micro-finance from 2000 and points out that the law rate and the lack of sufficient risk control tools lead to some operational problems. Rural credit demand has changed, but the supply failed to meet this change. The peasant household micro-finance market is imperfect in venture prevention. So, in chapter six points that it is urgent for the government to take effective ways to ensure the sustainable development of peasant household micro-finance business from supply and demand market, rate marketable innovation, venture management.