The Research On Risk Management Of Rural Microfinance In Hubei Province

As a credit service, microfinance continues to provide a small amount of credit service for the poor, low-income groups, and small and micro enterprise owners. The services include deposits, remittances, loans, payment services and micro-leasing services. It is not only an important way to alleviate poverty but also an important way to improve the financial services.Hubei Province is the major area to produce grains. Hubei Province is in the center of China, with185,900square kilometers and57,110,000people. Hubei Province accounts for1.94%of the total area of the country. The agricultural population in Hubei takes up a large proportion. The rural people are desirous for funds to get rich and promote development, but the number of farmers is quite large and they live far from each other, even they just need a small amount of funds for a single loan. Facing this situation, it has realistic meaning to develop the rural microfinance in Hubei province.The paper is divided into nine parts, the first part is the introduction, this part introduces the background and research methods. The second part of the passage is the overview, it focuses on the definition and characters of the microfinance and the process of the development, and it mainly elaborates the concept and correlative knowledge of microfinance. Part three is the risk management of foreign microfinance, and it introduces the risk management mode of GB, BRI and BANCOSOL, and the implications for the management of our own microfinance. Part four is the description about the microfinance development status of Hubei Province, which is based on the economic environment of Hubei province, and it introduces the issued subjects, the types of products, the use of microfinance, the distribution feature of clients, the situation of circulation and the development model. The fifth part mainly introduces the Hubei microfinance risk management, and it concluded natural risk, market risk, credit risk, operational risk, liquidity risk, and then it introduces the main reasons that cause the risk. Part six puts forward the main problems, such as the absence of external supervision and industry self-regulation in microfinance risk management according to the actual situation of Hubei microfinance operation. Part seven analyses risk management issues in Hubei rural microfinance, the article introduces the issue from the two aspects:The game between the rural microfinance institutions and government, the game between credit institutions and credit side, and the passage analyses the conflict between each participate of the microfinance in theoretical level. The eighth part gives six recommendations like strengthen the support intensity of external policy about microfinance risk management from the practical problems in Hubei microfinance operation process and microfinance trends. Finally, Part nine of the paper is about the conclusion and outlook.