The Study On Mechanism Of Formation,Warning And Control Strategy Of Credit Risk In Small Loans Companies

Microfinance is a kind of unsecured credit loans, which easy operate and quick approve for providing capital support for the development of small companies that excluding the formal financial institutions and improvement of low-income populations. However, the characteristics of the micro-credit also decided it’s high-risk. With the end of the small loan company experimented in2008, the formal legal and local private capital have poured into this industry, small loan companies established everywhere and the credit business developed a lot. Initiated by private capital "credit-only" new-type rural financial institutions, this is a useful attempt effectively to solve the financing difficulties of small and medium-sized enterprises and farmers. Firstly, it has played a great role in promoting county economy and the prosperity of the rural financial market; Secondly, it seek a reasonable and legitimate energy release channel for private finance; thirdly, helping to guide and regulate China’s huge underground financing; lastly, contributing to the diversification of rural financial ecosystem healthy and harmonious development.With the rapid development of small loan companies credit business, the subjective judgment of the decision to rely on the loan officer and approval of experts approval limit, which unable to adapt to the rapidly expanding needs of business. Therefore, a combination of a quantitative and qualitative credit risk control methods is urgent.This article is in the theoretical study based on the theory of the credit risk of small loan companies. Based on related literatures of small loan companies and analysis of the credit risk of small loan companies, and start to form small loan indicators of credit risk evaluation system elements, utilizing the Analytic Hierarchy Process to build credit risk prediction system to small loan companies. Finally, make recommendations and proposals, analyze and provide solutions to a small loan company, such as guaranteed loans, the introduction of third-party sources of information and strengthen internal controls and other measures.