Research On Transformation Of Financial Services In Micro And The Small-sized Enterprises Of SPDB

It is estimated that more than 90% of enterprises in China are small and micro enterprises(SMEs).These SMEs play an important role in stabilizing the economy,creating job opportunities,optimizing the economic structure,and meeting the increasingly diversified demands from consumers.Financing is a common problem for SMEs.To conquer the SMEs' financing challenge is essential for the long-term sustainability of SMEs and the overall society.Direct financing in the capital markets has been proven to be challenging given the unique characteristics of SMEs.Indirect financing via loans is the main way for SMEs financing and commercial banks play a key role in this way.Currently the traditional model of profitability of commercial banking industry has faced increasing difficult prospect,pushing them to look for new growth point.Providing financing for SMEs,which was a previously ignored “green-field”,is now the new growth driver for commercial banking industry.In the current economic climate of commoditization of financial products,the ability to offer differentiated and customized product plays a key role in the strategic management of SPD Bank.The traditional model that focuses on corporate banking service is no longer competitive in the present economic situation.Therefore,the banking model transformation focusing on financial services for SMEs would play a crucial role in the sustained development and future growth of SPD bank.This strategic repositioning for SPD bank provides not only executable tactics for its long term growth but also offers SMEs a platform to receive equitable and competitive market options,achieving a win-win situation.The first section introduces the background and importance of this research,including the review of relevant literature of the SME financing,its challenges and work-around.This section also gives an outline of the research methodologies used in this study.The second section introduces the current situation and the challenges of the SMEs financing program in SPD bank.A brief examination of the definition and characteristics of SMEs is made first,and then the definitions of SMEs and SMEs business on the ground of SPD bank's SMEs financing program is given.After that,the theoretic foundation of SPD bank's SME financing is presented,which provides principled guidance to how SPD bank conduct its SME lending business.The third section and the fourth section are focused on the transformation design for SMEs financial services of SPD bank.In that design,SPD bank proposed to switch the model of services from SMEs financing product to professionalized financing services as the goal.In order to satisfy the SMEs' financial demands,SPD bank adopted centralized management model to establish a new retail line and business operational infrastructure throughout the front,middle and back office operations.In order to enable SME suite of product development,SPD bank also invested in a systemized credit decision support platform,and established process flow for monitoring,ongoing reconciliation and overall portfolio management mechanisms.The case analysis illustrated two relevant case studies of SPD bank SMEs business financing.One of the cases is based on large supermarket supply chain cash flow management case;the other case is Chengdu Huadu Jiulong joint business group asset backed financing.The case analysis covers the background of the cases,development trajectory,business processes and other dimensions,and shows that how SPD bank can realize its transformation through SME business development.The conclusion and suggestions are based on the two cases introduced in the case analysis.In this part,we proposed 4 potential changes to support the healthy growth and expansion of SPD's SME business.This dissertation presents a unique angle combining theoretical with tactical suggestions to demonstrate how transformation can be achieved with institutionalized product development and systemized procedures and dedicated infrastructure to promote new product line.With comprehensive dissection of the SPD bank's SME business and using industrial chain financing as an example,this dissertation highlights how financial institutions systematically supporting a previously unchartered sector of the market can increase competitiveness and value of these enterprises as well as its related value and product chain.Given the limited view from the retail financial business line,this paper uses two cases to qualitatively analyze the design and theoretical potential.This can be strengthened by additional data from real world,which requires contribution from colleagues and others within relevant lines of business as well as other financial institutions.