Credit Risk Assessment Of Zhejiang Private Enterprises Basing On Life-Cycle Theory

After 30 years of reform and opening up, the private economy plays an important role in improving the efficiency of the national economy, expanding employment rate, stimulating domestic demand, improve productivity and technological progress of society, and promote healthy development of the economy. As a well-developed private economy province, Zhejiang has made quite large contributions for the national economy. However, most private enterprises are often constrained by insufficient funds to make the necessary financing to expand production in order to obtain long-term development. Private enterprises, especially in the early stages of development of private enterprises are often excluded by banks and other financial institutions. How to establish an objective and fair standards for their credit assessment is very important.For enterprises, they usually have four stages of the life cycle: start period, growth period, mature period, recession period. This theory designs a comprehensive life cycle for at different stages of private enterprise credit evaluation system, from domestic and foreign corporate credit assessment, closely around the factors affecting different periods of life cycle. Firstly, the passage probes credit ratings of Zhejiang private enterprises builds first-class indexes basing on the theory of corporate credit elements. Secondly, it designs second-class indexes focusing differently, according to the characteristics of different periods of the life cycle, and then uses AHP to obtain the relative importance of each factor and verify them. Lastly, the passage uses percentile scoring method to calculate actual scores of Zhejiang private enterprises in different life cycle periods. Then we can reach conclusions about credit ratings of Zhejiang private enterprises according the classification of credit ratings, providing the basis for banks, guarantee agencies and other financial institutions.Finally, we select a few private enterprises in Zhejiang as examples to verify the credit assessment system and scientific rationality on the passage. At the same time, it gives pertinent suggestions to domestic credit rating industry on how to develop.