China’s Rural Microfinance Policy Research City

Microcredit is a popular way for poverty alleviation in the world. It is a special credit that the finance instruments supply financial services to the poor people to help them throw off poverty. Microcredit emerged in1970’s.After20years of practice, it has covered almost all of the developing countries and some of the developed countries.In1999the People’s Bank of China began to popularize rural microfinance in our country’s rural credit cooperatives. The service has developed very quickly and has gained some achievements. Practice shows that micro finance is not only an effective anti-poverty means that can help poor farmers to develop agricultural product and get grid of poverty, but also an new rural financial institution, which has relieved the tensity in the supply and demands, situation of rural finance, system. However the present development situation of rural microfinance cannot meet the demand of agriculture economy development, there exist many problems, such as the deficiency on loan system, the low lending-rate, the deviation of legal status, lack of constants supervision and management. All these problems influence the long-standing development of rural microfinance. Meanwhile, insufficient capital, high risk, difficult management, and obsolete service all confine the existence and development of this micro financial organization. Whether these problems should be soundly solved will affect not only the survival and development of micro financial organization, the supporting safeguard for the peasant to increase the income, but also affect the rural credit market order and the continuous development of the system. The paper studies the restrictions of the microcredit of Rural Credit Cooperative Unions and analyses the sustainable development strategy of microcredit. Furthermore, the paper indicates that the essence of the microcredit should be commerce loans and the market is benefit for it’s sustainable development. At last, the paper analyzes the role of the government in the microcredit. The paper points out that microcredit not only can help the poor, but also can achieve its sustainable...