Study On Internal Control Optimization Of Operational Risk In Small And Micro-sized Finance

Small and micro-sized businesses play an important role in China's economy.They not only provide numerous jobs,but also are new economic growth points.They have become an indispensable part of China's economy and society.Therefore,our country has made a series of policies to encourage and support the development of small and micro-sized businesses.All major banks actively started small and micro-sized financial services,and such services have developed rapidly.However,in recent years,the frequent occurrence of operational risk loss cases by commercial banks in China has brought about considerable losses to banks,mainly due to the illegal operation of internal employees,the lack of strict implementation of business processes,the incompleteness of risk identification systems,and the lack of effective internal controls.All that belongs to lacking internal controls.Operational risks may occur at any stage of the small and micro-sized financial businesses.Sound internal control can help improve the management level of commercial bank operational risk by formulating and implementing a series of risk control systems and measures.If a commercial bank lacks a sound internal control system,it will not only increase the probability of operational risks,increase the cost of capital for banks,but also exacerbate the difficulty of financing for small and micro-sized businesses.Therefore,commercial banks must pay more attention to the internal control over the operational risk of small and micro-sized financial businesses.Minsheng Bank H Branch operates for a relatively short period and lacks experience in the operation of risk management for small and micro-sized financial businesses.The related internal control system is also not perfect.This paper,combined with the current management situation of the operational risk of the small and micro-sized financial businesses of Minsheng Bank H Branch,finds that the following problems exist in the internal control of the operational risk of the these businesses: Inadequate human resources management,decentralized responsibility for business personnel risk management,lack of risk identification models,poor implementation of business process controls,inadequate information transfer mechanisms,and lack of internal control supervision systems.After in-depth exploration of the reasons for the problems,the following suggestions were made: improving human resources policies,establishing a separate operational risk management department,strengthening the identification and control of operational risks in small and micro-sized financial businesses,strengthening the process control of small and micro-sized financial services,optimizing information communication and feedback system,and emphasizing the dual roles of internal audit and external supervision.In order to ensure the effective implementation of the internal control optimization of the Minsheng Bank H Branch,it is proposed to establish a strict accountability investigation and accountability mechanism,create a good operating risk management culture,establish an information-based risk control technology system,establish a complete database of small and micro-sized businesses and make five guarantee measures for operational risk management evaluation system to improve the internal control status of the Minsheng Bank H branch's small and micro-sized financial businesses and reduce the occurrence of operational risks.This paper will help improve the internal control of Minsheng Bank H Branch's small and micro-sized financial businesses and prevent operational risks.Although taking Minsheng Bank H Branch for instance,it also has reference value for other commercial banks to improve the internal control of the operational risk of small and micro-sized financial businesses.