Study On The Impact Of Loan Guarantee Insurance On The Financing Capacity Of New Agricultural Business Entities

In recent years,with the development of China’s economy and the advancement of urbanization,a large number of labor forces have poured into cities and towns from rural areas,and the level of agricultural production has continuously improved.China’s agricultural development has entered the modernization process.The transformation of the mode of agricultural development has pushed the new agricultural management entities onto the historical stage.Compared with traditional agriculture,the production activities of new agricultural business entities are characterized by intensification,scale,technology,and organization.These characteristics have gradually led to the development of new agricultural business entities as the main force in China’s rural financial market.However,due to various factors,new agricultural business entities are facing financing difficulties.Loan guarantee insurance has the dual functions of insurance and guarantee,which is very suitable for the financing needs of new agricultural business entities,can effectively solve the financing difficulties of new agricultural business entities,and effectively improve the financing capacity of new agricultural business entities.In March 2022,the Ministry of Agriculture and Rural Affairs issued the "Notice on Implementing Actions to Promote New Agricultural Business Entities",which clearly stated that we should accelerate the transformation of new agricultural business entities from quantitative growth to qualitative growth,achieve high-quality development of new agricultural entities,and provide strong support for comprehensively promoting rural revitalization and accelerating agricultural and rural modernization.We should do a good job in providing financial services to new agricultural business entities,improve the financial service organization system suitable for the development of new agricultural business entities,expand diversified financing channels,and gradually develop loan guarantee insurance business.The research on how to improve the financing ability of new agricultural business entities through loan guarantee insurance has important theoretical and practical significance.The paper first introduces a classic case of the loan guarantee insurance model in Sanshui District,Foshan City,Guangdong Province,introducing the case from the aspects of its background,operation mode,main content,and operation,and conducting an in-depth analysis of the effectiveness and existing problems of the case.Secondly,by studying the financing demand characteristics and financing difficulties of new agricultural business entities,it is concluded that new agricultural business entities have the characteristics of flexible capital demand and large capital demand scale.Due to the lack of effective collateral,loan term mismatch with production and operation,and the lack of risk sharing and compensation mechanisms,their financing difficulties are caused.In response to this situation,the paper analyzes the impact mechanism of loan guarantee insurance on improving the financing capacity of new agricultural business entities.Based on the mechanism analysis,the current situation of China’s loan guarantee insurance to improve the financing capacity of new agricultural business entities is analyzed.Analyze the development status of three loan guarantee insurance models,namely,the "Government+Bank+Insurance Company" tripartite cooperation model,the business model led by insurance companies,and the mortgage model,summarize the existing problems that loan guarantee insurance affects the financing ability of new agricultural business entities,and analyze the reasons.Finally,based on the full text of the study,suggestions are proposed to promote the development of loan guarantee insurance and further enhance the financing capacity of new agricultural business entities.On the one hand,it is recommended that the government introduce loan guarantee insurance support policies,improve the construction of relevant laws and regulations,and promote in-depth cooperation among the government,bank,and insurance.On the other hand,insurance companies should increase the publicity of loan guarantee insurance products,innovate product types,improve risk sharing mechanisms,and strengthen cooperation with banks.