Research On The Risk Management Of Shanghai H Small Loan Company

The small loan company is a class financial institution; the main business of it is lending activities and providing related information. Moreover, the small loan company generally formed as a joint-stock system. The shareholders of the company are composed of enterprises, individuals and other social organizations. The biggest difference between small loan company and commercial banks is that the small loan company cannot absorb public deposits. In addition, the loan funds from shareholders of the company are normally the unique income source of the company.The financial crisis in 2008 resulted a plenty of micro enterprises suffered great lacking of assets. Moreover, numbers of substantial economy institutions had not got enough capital for production. Hence, Shanghai government tried to encourage local capital to invest assets to establish a pioneer micro-credit institution form as small loan companies. Additionally, Shanghai is one of the financial centers of the world, and it is also one of the most advanced cities in China. Hence, the increasing number of small loan companies in various districts and counties are very rapidly. By the end of May 2016, approximately 134 small loan companies in Shanghai were approved to establish. The total number of the registered capital is about 20 billion 140 million RMB YUAN, and the loan balance are about 22 billion 7 RMB YUAN, and the number of the clients reached 179,598.Because of the simple and flexible procedure of the company, small loan companies provided funds for enterprises, individuals and farmers who really need it. But the development of the small loan company is not perfect and the customer base of the company is poor. Once the loan risk occurred, the subsequent operation of small loan companies will bring a lot of difficulties. So it is probably that the risk management is the top priority of small loan companies to some extent.This paper takes the Shanghai H small loan company as theobject of the research; and combined with a variety of previous researches on the risk management of small loan companies, research on the status of risk management. Then discover ed the problems in the risk management of the company and analyzed the problem, moreover,suggested the appropriate risk management measures and recommendations for Shanghai H small loan company.Finally, the main conclusions are as:1. H small loan company as a new high-risk industry, the problem of its risk management is mainly composed of three aspects: the company's business strategy, external factors and the company's internal risk management system.2.Aiming at the problem of risk management of Shanghai H small loan company, this article put forward measures and suggestions for optimizing business strategy, reducing the impact of external factors, strengthening the internal syst em management.3. Finally suggested that H small loan companies to establish an effective circulation of risk management system, so that H small loan companies can conduct a cyclical sustained risk management.