A Study On The Impact Of Farmland Mortgage Loan On Farmers’ Loan Depth

The financing problems resulted from the lack of qualified collateral recognized by the financial institutions is the plight that China’s rural finance is always facing.In recent years,the Chinese government has tried to increase the credit supply of rural financial markets by expanding the scope of rural collateral.In March 2009,the People’s Bank of China and the China Banking Regulatory Commission made it clear that "conditional areas can be piloted for farmland contract management right mortgage loan"(hereinafter referred to as"farmland mortgage loan")Jiangsu is one of the earliest provinces to explore the "two rights" mortgage.The first pilot of farmland mortgage was launched in Xinyi City since 2009.Farmland mortgage loans have a far-reaching impact on improving the efficiency of agricultural production and management,innovating farmers ’ financing methods and solving the problems of financing difficulties caused by lacking collateral.The operation effect is reflected in the improvement of farmers’ credit availability,including the loan breadth and loan depth.However,farmland mortgage loans are still in the early stages of the pilot.Due to legal,policy and various conditions,farmers who have obtained farmland mortgage loans are mainly concentrated in the large size of the production and people of good credit record in the actual operation process.Farmers of small production size basically have little access to farmland mortgage loans,and farmland mortgage loans are limited in breadth.To the farmers who get the farmland mortgage loans,the study on whether the farmland mortgage loan has raised farmers’loan depth is vacant.In order to test whether the farmland mortgage loan can increase the number of loans to improve the loan depth,based on the theories of farmland property right theory,farmland system theory and modern credit rationing theory,this paper compares the pilot households and non-pilot areas,selecting seven variables through the farmers’ personal characteristics and external characteristics:the age of the head of the family,the education period of the head of household,the family labor force population,household net value of productive fixed assets,whether the family is of big size of production,household wage income ratio,household actual cultivated area.The Propensity Score Matching Method was used to exclude the sample selection bias between the "intervention group" and the "control group".The depth of the farmland loan was estimated from three angles:the unit land loan amount,the total loan amount and whether the household is of the partial quantity rationing.The results show that the farmland mortgage loan increases the total amount of farmer loans and reduces the probability of farmers’ partial quantity rationing,but the promotion for the unit land loan amount is not significant.Then,measuring the factors of the depth of the loan from three aspects:the unit land loan amount,the total loan amount and whether the household is of the partial quantity rationing.Using the multiple regression model to measure the unit land loan amount and the total loan amount and using the Probit model with binomial distribution to analyze farmers’ quantity rationing.It can be found that the larger the household actual cultivated area,the larger the size of production,the lower the household wage income ratio,the lower the unit land loan amount is.The younger the age of the head of the family,the larger the size of production,the higher the household wage income ratio,the higher the total loan amount is.The longer the education period of the head of household,the higher the household net value of productive fixed assets,the lower the household wage income ratio,the bigger the household actual cultivated area,the lower partial quantity rationing probability is.Based on this,this paper puts forward some suggestions on improving the relevant laws and regulations,perfecting the value of farmland management right,setting up multi-level and full-scale compensation system of farmland mortgage and exploring the disposal mechanism of farmland collateral.