Capital Dominated Reform:Local Practice Of Farmers Financing Credit Cooperation

The rural financial system is the most important allocation system of capital factor in rural areas.Among them, rural financial system in the macro level is one of the important factors that leads to the difficulty of farmers financing guarantees.Nowadays farmers are short of effective collateral, so they are difficult to get the loans from the bank. On the other hand, due to the lack of necessary risk guarantee, the bank won’t lend easily. To some extent,this kind of contradiction causes the huge outflow of rural capital, and a serious situation--lacking of capital comes into being.Based on this, in Decerber,2011, after members of central rural work leading group and the ministry of agriculture’s approval, ShaXian becomes one of the six rural financial system reform experimental zones in China and the only one in fujian province.In order to solve the difficulty of the farmers’s guarantee, ShaXian local government founded village-level financing guarantee fund. It is one of highlights.In this essay, I choose the village financing guarantee funds as the research object, and Village Guangzhuan in Middle Fujian Province as the case village, try to find out the period before, during and after local government-led rural financial policy innovation, analysis how to use different capital to dominate the financial reforms by describing the farmer financing credit cooperative--village-level financing guarantee fund in this case village. Research found that the reform of farmers financing credit dominated by local government began in May2012. The local government not only set up a temporary financial regulatory agencies, but also came out a series of documents of local financial reform policy, and integrated and aroused the enthusiasm of rural credit cooperatives, village and farmers to participate together. After the coordination of all parties’interests, finally had a new policy. The new model--the village level financing guarantee fund was introduced into the village.Reform does not stop, ShaXian local government is exploring and perfecting continually, timely adjust and bold innovate in the pilot village. They evade the risk of fund operation by developing the role of the rural social capital and set up a security system.After Funds entered into the village, it not only effectively make the farmers credit markets active, accordingly promote the rise and transformation of village industry, but also provides a power source for the financial development of county economy.We can say, the success of this kind of farmers financing credit cooperation which is based on traditional rural society cooperation and mutual trust, dominated by local governments and farmers, and main body the farmers, not only reflected experience in the area of the financial reform mode innovation, but also reflected that the local government promoted the reform of the local practical experience.There are five chapters in this essay. The first chapter is introduction, mainly expounds backgrounds of the research, puts forward problems, lists predecessors’views, analysis framework and the method, and describes the sample area and traditional farmers financing credit.The second chapter tells the story before the policy entering the village, the three party:Agriculture and finance office in Shaxian, government in Gaoqiao and village competed around the investment mode, and at last they came out the final negotiations flexibility and finalize the policy tone.The third chapter tells the story during the fund came into the village, it promoted the two affairs:credit file and build risk gate by the rural social capital. The fourth chapter tells that after the economic capital abundance, benefits for village economy and the county economy.The fifth chapter is the conclusion. I think that we should not only play the role of the authority of government capital in policy implementation, but also rely on and make use of the positive factors of China’s rural social capital, such as village trust and cooperation with farmers.By the leading of authority capital and rural social capital, on one hand, it provides the possibility of opening the channel of hierarchy of local government governance smoothly. On the other hand, it provides legitimacy of the local policy. What’s more, it can effectively solve problems that the farmers who lack of economic capital is scarce for financing credit. On the basis of this, it also brings about some certain economic benefits.