How Monetary Policy Affects Financing Constraints Of SMEs In China

This paper focuses on the impact of monetary policy on the financing constraints of SMEs,in which SMEs are represented by SMEs listed on the SME board.Small and medium-sized enterprises(SMEs),which have the characteristics of large number and wide coverage,are very important economic entities in the whole economy.They make up of the microeconomic subject partly and play an important role in promoting the sustained economic growth of our country.China has gradually promoted the transforming and upgrading of economic structure in recent years.For small and medium-sized enterprises,the government has also introduced policies to encourage and support the development of small and medium-sized enterprises unswervingly.It can be said that the contribution of small and medium-sized enterprises to GDP and full employment can not be ignored.At the same time,SMEs have always been in a disadvantaged position in accessing external financing.Due to the weakness of risk prevention and control ability,low credit rating of the SMEs as well as imperfect development of capital market in China,the external capital demand of SMEs can hardly be solved through capital market.They can only rely on traditional bank credit channels,and even face difficulties in obtaining loans from commercial banks and other financial institutions.At the same time,SMEs are facing difficulties in obtaining loans from commercial banks and other financial institutions.The tightening of monetary policy will lead to the change of money supply and interest rate in the economic system,which will influence the supply and cost of capital market financing,and make the financing of small and medium-sized enterprises affected by monetary policy,thus forming more serious financing constraints and furthermore restricting the sustainable development of small and medium-sized enterprises to a certain extentTo study the impact of monetary policy on SMEs'financing constraints,the most important thing is to study monetary policy and financing constraints.Through the collection and collation of the financial data of the small and medium-sized listed companies on the micro level from 2004 to 2017 and the macro-monetary policy data,the mixed panel data is combined.In the setting of the regression model,the relevant variables of corporate financing constraints are listed as dependent variables,and the monetary policy-related proxy variables are used as independent variables.At the same time,the variables that reflect the characteristics of the enterprise are selected as control variables,and the regression model is established.The empirical research and analysis are carried out by regression of single dependent variable and single independent variable one by one.It can be found from the empirical results that the degree of monetary policy relaxation will have a certain impact on the financing constraints of SMEs in China.For the regression between different methods of measuring the financing constraints and different monetary policy proxy variables,the change of monetary policy has different impact on the financing constraints of SMEs in China.Accordingly,this paper also puts forward relevant suggestions.Therefore,when formulating monetary policy,the government should consider the possible impact of monetary policy tightness on SMEs,and thus can implement differentiated monetary policy to support the development of SMEs.The commercial banks can also implement more credit preferences for SMEs under the premise of controlling risks,so as to ensure that SMEs can get a certain amount of financing to maintain themselves.At the same time,SMEs should constantly enhance their comprehensive strength,improve their core competitiveness,and do a good job of risk prevention to cope with different degrees of financing constraints that may exist.