The Research For Credit Risk Management Of Micro Loan Company

As an innovation in the financial system,micro loan companies play significant roles in relieving the finical stress of micro or median company,promoting the development of agriculture,as well as contributing to the Financial diversification of China.Since the May of 2008,the government has implemented several policies to actively regulate and guide the healthy development of the micro loan company.As a result,micro loan companies are blooming all over the country.Recently,along with the deep revolution in the financial system,the micro credit is coming across a series of new opportunities as well as facing a great number of challenges.Micro loan industry is a high risk industry and the risks comes from all aspects.Most newly founded micro loan companies are facing the high possibility of bankrupt due to the lacking of experience in risk control,lack of risk control mechanism.Thus,it is crucial to see the risks micro loan companies might encounter as well as find ways to manage risks.The purpose of this paper is to improve the credit risk prevention,and control ability of the micro loan company;to achieve scientific,standardized and efficient administration,to maintain a stable development,and also to better serve the local micro companies.Last but not the least,the paper tries to find a healthy and sustainable development way for the micro loan industry.This paper takes micro loant company A in Jiangdong district,Ningbo as an example to investigate the micro loan risk management issues.This chapter is divided into six chapters: the first chapter is the introduction,including the background and significance of research,literature review,research ideas and research methods;The second part explains the concept of micro loan company,micro loan and risk management,further emphasizes on the importance of micro loan risk management,and introduces the relevant theories.The third chapter gives a brief introduction of the development of the micro loan company and analyzes the inside and outside problems faced by the company and the risk management measures taken;the forth part introduces the practices that we can learn from in managing the credit risk in Bangladesh Country Bank and Credit Suisse.The fifth part focuses on strategy and is the key part of the paper.,which includes establishment of the risk management goal,modifying the company policy to reduce the internal risk,reviewing the whole loan process to reduce the external risk and paying attention to the change of regulation.The conclusion part comes in the last.