City Commercial Banks To Carry Out The Necessity Of Small And Medium-sized Enterprise Financing And Countermeasure Research

The small and medium-sized enterprise along with the privately or individually-owned business play a very important role in our national economy. But speaking of the above-mentioned important group, we know that their financial demands are not well met. It is hard for the small and medium-sized enterprise to do fund-raising, which leads to a bottleneck problem affecting the enterprises’development. There are various reasons for this problem. And this happens partly owing to the enterprises themselves. For instance, the enterprises are always at very high market risk, which enables the financial sectors unwilling to give loans to them easily; also the enterprises have limited capital and low debt capacity, which affects their ability in getting fund-raising; the small and medium-sized enterprise also have a lower creditability, and the banks are not likely to give loans easily; the small and medium-sized enterprise are of multiple classes,and they need a small fund once and they need fund-raising frequently, which makes the banks’fixed costs of financial service higher.; the small and medium-sized enterprise also have a low fixed asset, and it is hard for them to get loans on mortgage. In addition, the banks and the intermediaries are also partly responsible for this fund-raising problem. There are over-elaborate procedures and it is very time-consuming for the medium and small enterprises when doing fund-raising, which reduces the enthusiasm in fund-raising; the banks also despise the poor and curry favor with the rich, which results in the disadvantageous position for the medium and small enterprises, the banks have improper ways to evaluate the enterprises’credibility; the intermediaries overcharge the enterprises; and the guarantee system is inadequate.The city commercial banks are the main body of the medium and small banks, in such circumstances, they are facing fierce competitions, in the meantime, the banks also enjoy distinctive competitive advantages; they have efficient decision-making,and they know the local people and places well; they have advantages when it comes to organization, staff and flexibility in operating mechanism; meanwhile, they have decent support, policy and supervision preferences from the local governments. All the above-mentioned advantages can be made the most of only when providing financial service for the medium and small enterprises.In the process of financial service, the city commercial banks also have problems and difficulty, they are at high credit risk, they have asymmetry of information, they find it hard to evaluate credibility and to give loans on the mortgage. It is hard to take the incentive or restraining steps when doing fund-raising for the medium and small enterprises. After analyzing the above-mentioned issues, this paper comes up with some suggestions on the strategies of the financial service. It insists that to serve the small and medium-sized enterprise is our market orientation; we are supposed to establish credit asset structure, ensuring the proper ratio of the loans for the medium and small enterprises; to establish a stable and diligent staff, solving the problems getting information; we are supposed to enlarge and innovate the way of fund-raising on mortgage, reducing the requirements for entering for the medium and small enterprises. In the end, the writer himself makes a summary of a successful case of fund-raising-Baotou City Commercial Bank Pattern based on the cooperation and communication with his colleagues, in the case he also introduces the basic information and the market orientation, analyzing his bank’s accomplished ways and major achievements in terms of enterprise’s fund-raising, hopefully the paper will provide people with experience for reference.