Path Of Transformation Of Small Loan Companies In China

In recent years, with the vigorous development of small loan companies in China,problems ensued. Small loan companies face many problems, such as financingdifficulties, poor regulation. How to achieve the sustainable development of smallloan companies has become a hot issue and the focus of attention of the academiccommunity and society. One way is that small loan companies become town banks.CBRC issued “Provisional Regulations on Small loan companies into town banks”.However, some regulations, such as the main sponsor must be financial institutions,are too harsh to transformation.In this context, this paper analyzes characteristics of small loan companies andtown banks deeply, compares them. Also it analyzes the situation and problems, thenobtains the necessity of transformation. Then paper makes SWOT analysis on smallloan companies which meets the “Provisional Regulations”. Paper analyzes theadvantages, weaknesses, opportunities and threats of transformation into town banks.For small loan companies which don’t meet all the “Provisional Regulations”, paperuses SWOT analysis and conditions portfolio analysis. Specifically, paper groups fiveconditions in “Provisional Regulations” into three assembles and makes SWOTanalysis, obtains three paths. Paper also makes case study of Taiwan RCAsconversion and BancoSol, because there is no transformation success in China. Itprovides a reference for the transformation of China’s small loan companies and otherpaths.