Research On The Legal Issues Of The Supervision Of Small Loan Companies

In 2005,the People’s Bank of China decided to carry out the pilot work of microfinance in Shanxi,Shaanxi,Sichuan,Guizhou and Inner Mongolia.In December of the same year,two small loan companies,Jinyuan Tai and Rishenglong,were established in Shanxi Province,and the pilot work of the small loan companies was gradually promoted throughout the country.On May 4,2008,the People’s Bank of China and the Banking Regulatory Commission jointly issued the Guiding Opinions on the Pilot Project of the Small Loan Companies.After more than ten years of pilot projects,microfinance companies have developed rapidly in China.According to the statistics published on the website of the People’s Bank of China,as of the end of September 2018,there were 8332 micro-loan companies in China,with a loan balance of 927.1 billion yuan.In the "Opinions of the Central Committee of the Communist Party of China and the State Council on Comprehensively Deepening Rural Reform and Accelerating Agricultural Modernization"(Central Document No.1)in 2014,it also involved microfinance companies: "For small loan companies,it is necessary to broaden financing channels.Improve management policies,speed up access to credit reporting systems,and play a small role in supporting agriculture." In fact,in the previous seven central documents No.1 from 2004 to2010,policy planning was proposed for the development of microfinance.It can be mentioned in the No.1 document of the Central Committee.It can be seen that the Party Central Committee and the State Council attach great importance to the development of microfinance companies.It can be seen that in the future development,microfinance companies will be able to obtain more policy support and microfinance loans.The financing channels of the company will be broadened,the sources of funds will be more extensive,the management policies will be more and more perfect,and the role of supporting agriculture will be more prominent.However,there are still many problems that need to be solved urgently in the development of microfinance companies,such as single business,narrow profit margin,limited financing channels,lack of standardization of financing,high risk,frequent usury disputes and so on,and even some illegal and criminal acts,such as disguised absorption of public deposits,usury and sublending,such as "campus loan" and "routine".Loans and cashloans have aroused strong public reaction and seriously damaged the interests of the masses.This not only hinders the sustainable development of micro-credit companies themselves,but also destroys the social and financial order.If these problems can not be solved in time and allowed to develop in the long run,it is very likely to trigger the micro-credit crisis,which will affect the social stability of some areas.Therefore,for micro-loan companies,the state needs to implement the necessary legal supervision.On the one hand,it is to promote the sustainable development of micro-loan companies and make them play a small role in supporting agriculture;on the other hand,it is to maintain social stability and prevent financial risks.In addition to the introduction,this article is divided into three parts.The first part is the writing of basic theoretical knowledge of microfinance companies.It focuses on the emergence and development of microfinance companies,the legal nature of microfinance companies,and the necessity of implementing legal supervision of microfinance companies.An overview of the regulation provides a basis for the topic.The second part is to analyze some problems and their causes in the legal supervision of China’s microfinance companies,and further provide research value support for the topic.The third part is the analysis of the problems and causes of the microfinance companies in China discovered through the above-mentioned parts,and proposes the perfect measures for the legal supervision of China’s microfinance companies at this stage and in the future.