Erdos Micro-loan Company Risk Management Research

Since2005, the first Micro-loan Company has introduced to China, this kind of company just experienced its prosperous development in the next six years.The role of Micro-loan Company not only solved the low-income population with financial services,also include small and medium-sized enterprises, and become the effective way of the folk to lend and borrow legally.It is useful in optimizing the allocation of capital resources, making up the shortage of credit funds in financial institutions, improving the financial service, certainly playing a supplementary role on formal financial markets. However, because of blindness in development of Micro loan company, its awareness of risk management is exceptionally weak. Once the financial crisis occurred, it would have a harmful effect on the local financial system. When the Micro loans company in supporting to financial services of enterprise individual, at the same time it is also significant and profound for the Micro loan company to prevent and control risk. In order to construct regularly, the Micro loan company should be improved through the internal control and a good external policy, also should make feasible measures to prevent risks according to its financing ways and risk characteristics,recognize the way that they use capital properly, and proposes the corresponding resolution to aim to keep away from risk.This paper, from the view of the concept and characteristics of the Micro loans, also the theory of risk management, analyzes the necessity of Micro loans company to emphasize on development of the risk management, and points out risks and problems that the Micro loans companies in Erdos faced to.Secondly the paper mainly focuses on how to avoid credit risk and the infection of credit risk.This paper tries to establish a credit index system on the basis of lending decisions. By means of5C experts’ method and fuzzy comprehensive evaluation method, this paper sets up a model of customer credit evaluation, which is verified by the examples in fact. Also, this paper reveals the possibility of the credit risk infection among Microfinance Company from the view of operation mechanism in capital chain in Erdos. Finally get the conclusion of the research also summarize the limitations and shortcomings.