Research On The Optimization Of Government Functions To Ease The Financing Constraints Of SMEs

As the most active market subject,SMEs play a pivotal role in promoting industrial development and economic growth,increasing social employment and stimulating technological innovation.Since the reform and opening up,China’s SMEs have made great progress,but at the same time,financing constraints have been restricting the further development of SMEs.Especially in recent years,as the economy has entered a new normal,and market competition has intensified,the internal financing capacities of SMEs has weakened,the demand for external financing has further increased,and the problem of financing constraints has become prominent.At present,in the financing process of SMEs in China,there are both market failure and market deficiency,as well as the quality of enterprises themselves。Relying on market forces alone can not effectively solve the financing constraints of SMEs.The government needs to perform regulatory functions and intervene.Based on the theory of government regulation,this paper uses normative research and comparative analysis methods to study the optimization of government functions in the financing process of SMEs.This paper holds that the coexistence of market failure and market deficiency is one of the characteristics of china’s financial market development,and is also the main reason for the government to perform regulatory functions and interfere with the financing of small and medium-sized enterprises.Due to the market failure caused by information asymmetry,and market deficiencies caused by imperfect market mechanisms imperfect market systems,SMEs problems such as single financing channels,insufficient capital supply,and high financing costs,thus forming the financing constraints for SMEs.In order to ease the financing constraints of small and medium-sized enterprises,the Chinese government has actively adopted a number of regulatory measures in recent years.on the one hand,through measures such as window guidance,RRR cuts to guide commercial banks’ direction of loan investment and increase loans to SMEs;On the other hand,through measures such as building a financial credit information sharing platform,improving the credit guarantee system,improving the risk compensation mechanism,and developing local small and medium-sized financial institutions,to overcome market failures and make up for market deficiencies actively.However,due to the existence of factors such as government rent-seeking behavior,information asymmetry between government and enterprises and the high cost of support,there are still some shortcomings in the performance of government functions in alleviating the financing constraints of SMEs,and it is necessary to optimize.Based on the experience of developed countries,this paper proposes to optimize the government function in alleviating financing constraints of SMEs in six aspects:drive the reform of the administrative system,promote the marketization of government interventions,establish a dedicated management agency for small and medium-sized enterprises,establish an information sharing platform,deepen the reform of the financial system,and improve the government’s credit guarantee function.