Research Of Private Lending Impact On Smes Financing

Financing of SMEs is a worldwide problem. SMEs are a force in the developing national economy, however, difficulties in financing has become a major bottleneck restricting the development of SMEs in China. In recent years, in order to alleviate the difficult problem of corporate finance, the state has adopted a series of measures to increase the proportion of loans to SMEs. Although the major financial institutions to respond positively to the timely adjustment of loan structure, innovation on credit, the introduction of the varieties of loans for small businesses to increase loans to SMEs, the difficulty of access to bank loans to SMEs is still great. Informal finance can not meet the funding needs of SMEs, SMEs need to seek new financing channels. With the sustained and rapid economic growth in the types of market players funds demand, financing difficulties of SMEs at the same time, private capital is increasingly abundant, the private lending market has become increasingly active, the scale of financing has expanded each year. Private lending to become an inevitable choice for the SME development process. The development of private lending is not only active in the financial markets, and better promote local economic development is a useful complement to the formal financial. Study of private lending for SMEs development, the development of SMEs, to grow and has practical significance, this paper along this line to start is divided into six parts.The first part is an introduction. First analysis of the background, purpose and significance of the study. Literature review and theoretical research on domestic and foreign scholars, including the definition of private lending, private finance to explain the cause of development, domestic and international private lending development and SMEs research status. Re-analysis of the innovation point of the article and inadequacies.The second part is the definition of the scope and the domestic situation. First make a definition of private lending and SMEs, the scope of this research to determine this study of private lending in the economy generally refers spontaneously, divorced from economic entities outside the country’s financial regulatory system (individual, corporate and other economic agents) are engaged in money value transfer and repayment of the sum of the activities of the subject matter; SMEs discussed in this paper mainly refers to private small and medium enterprises. Followed by analysis of the development process, status, type and characteristics of China’s private lending. Finally, the mode of financing for SMEs and SME financing status in China.The third part through the analysis of the feasibility of the SME financing from private lending from the perspective of the different stages of the life cycle, including four stages:Start-up, growing, mature, decline. From asymmetric information, SMEs internal and external three aspects in the feasibility analysis, analyzed the reasons for the difficulty of SMEs financing. For these reasons better explain the feasibility of SMEs to seek the help of private funds.The fourth part use two cases show positive effects and negative effects of private lending. First, small loans to crack the case of the "bricks without straw", this case illustrates the positive significance of the small loan companies; loan sharks resulting boss escape "case, this case has exposed the hazards of usury, indicating that private lending urgent need of guidance and supervision in the market.The fifth part is the private lending Empirical Analysis of the impact on SMEs financing. The use of private lending scale and SMEs output analysis, stability analysis is first to collect data, in the same order as stable conditions are met, to build a linear regression model. Finally concluded that a1percent increase when the scale of private lending, SMEs output will grow by1.5%.The sixth part of the basic conclusions and policy recommendations. The basic conclusion of the article before analysis with conclusions and policy recommendations before drawn from the analysis put forward eight recommendations to promote the orderly development of the private lending market. Establish and improve laws and regulations related to private lending and improve the legal environment; accelerate market-oriented interest rate reform, opening up domestic financial markets; relax the market access of financial organization, strict market exit; to encourage private finance, with the formal financial cooperation; build the deposits of private financial insurance system; build a credit society, a sound credit guarantee mechanism; government guidance to reduce the improper intervention in the private lending capital flows; strengthen the supervision of private lending.Private financial thrive, SMEs thrive; Private financial decline, SMEs decline. Orderly development of the Private lending market for the financing of SMEs to create new opportunities.