Analysis on how banks develop financing business for small and medium-sized enterprises

First of all, it analyzes how banks carry out SME financing business.

This paper analyzes and thinks about the financing business of small and medium-sized enterprises in banks. Keywords: 1 risks and benefits of direct financing channels for small and medium-sized enterprises in commercial banks. The development of small and medium-sized enterprises is the basic force to promote the development of China's national economy, build the main body of market economy and promote social stability, especially in ensuring moderate growth of the national economy, alleviating employment pressure, rejuvenating the country through science and technology and optimizing the economic structure. Since the reform and opening up, small and medium-sized enterprises have developed rapidly. It is reported that the number of SMEs officially registered in China exceeds100000, accounting for 99% of the total number of enterprises in China; The value of final products and services created by small and medium-sized enterprises accounts for more than 50% of China's GDP, 60% of exports, 43% of taxes and 75% of urban employment opportunities. Small and medium-sized enterprises have become an important part of national economic development, and have played an irreplaceable role in absorbing labor, promoting market competition, facilitating people's lives, promoting technological innovation and promoting economic development. Small and medium-sized enterprises have become a new growth point to stimulate the economy. Second, the development of financial services for small and medium-sized enterprises is of strategic significance to commercial banks. 1. The contribution of major customers decreased rapidly, and the profit margin of banks gradually narrowed (1). The fund management level of major customers has generally improved. Large customers have basically established a capital network, and the intensive management of funds has led to a gradual decline in the share of deposits and loans of large banks and enterprises. (2) The financing ability of major customers has been improved, the direct financing channels have been unblocked, and the demand for traditional loan business has not increased enough. For example, the rapid development of short-term financing market has accelerated the pace of "financial disintermediation", and the traditional credit business of commercial banks is facing a severe test. (3) The target markets of banks are converging, and fierce competition leads to banks being in a weak position in negotiations with major customers, with weak loan bargaining power and low income level of intermediary business. Under the pressure of competition, the loan interest rates of many big customers of banks are below the benchmark interest rate, especially the monopoly group customers are mostly down 10%, and the intermediary business of big customers often does not charge or underpays because of pursuing considerable loan spreads. 2. The contribution of small and medium-sized enterprises has gradually increased, and it has increasingly become the strategic goal of the development of commercial banks (1). Banks have strong bargaining power for loans to small and medium-sized customers, and the income level of intermediary business is high, which has become a new profit growth point. According to the survey data of Zhejiang Branch of a state-owned bank, the loan balance of small and medium-sized enterprises accounts for 70% of the loan balance of corporate customers, and the loan interest rate of small and medium-sized enterprises rises by an average of 20% on the benchmark interest rate, which is much higher than other loan income. 85% of the interest income of enterprise loans comes from small and medium-sized enterprises, and small and medium-sized enterprises in intermediary business, international business and credit card business are also the main force to generate income. (2) Disperse risks and increase liquidity. Commercial banks can spread the concentration risk by developing the financial business of small and medium-sized enterprises, and make strategic adjustments to the credit asset structure and customer structure; At the same time, because the credit demand of SME customers is mostly short-term credit products, it is of great significance to expand and develop short-term credit products suitable for SMEs to adjust asset structure and reduce the risk of asset-liability mismatch. (3) Rich resources, great development space and great potential. At present, there are a large number of small and medium-sized enterprises and individual industrial and commercial households, and the proportion of small and medium-sized enterprise customers to the total number of bank customers is extremely low, forming a great contrast. Therefore, the huge resources and business development space of small and medium-sized enterprises need to be tapped and expanded. Three. Analysis of the financing situation of small and medium-sized enterprises and the reasons for the difficulty in lending 1. The imperfect credit system makes banks generally reluctant to lend. From the bank's point of view, security, liquidity and profitability are the basic requirements of bank loans, and the high operational risks of small and medium-sized enterprises make them a natural barrier for banks to strengthen their loan support for small and medium-sized enterprises. The life span of SMEs in China is very short. According to the large-scale sampling survey of private enterprises in China, before 1993, the average duration of private enterprises was only 4 years, which increased to 7.02 years in 2000. 70% of SMEs will be eliminated within five years after starting a business, while less than 10% of SMEs have been operating for more than10 years. In this case, financial institutions are cautious about SME loans. From the point of view of enterprises, many enterprises lack the concept of credit, don't talk about credit in the relationship between transaction and financing, and often deliberately default on loans. Coupled with the absence of local protection, government intervention, dishonesty punishment and other laws and regulations, the phenomenon of evading bank debts is becoming more and more serious. After the enterprise defaults, it is difficult for banks to recover the principal and interest of loans, so they have to strengthen credit management and improve lending conditions, which leads to widespread reluctance to lend. 2. Lack of effective mortgage guarantee has become the primary obstacle to financing. More than 90% of the workshop land of small and medium-sized enterprises in China is mostly collective land and homestead. Real estate mortgage is a common guarantee method for banks to issue loans at present, and it is also an important way for guarantee companies to guard against loan risks. Due to the legal ambiguity of the subject of collective land ownership (at least three), it is difficult to determine the subject of collective land ownership in practical work. In addition, administrative power is often used to replace the management right of land assets, which brings the "boundary" of land property rights of all subjects in the process of collective land circulation, resulting in the problem that the right to use collective construction land is difficult to mortgage. The "Guarantee Law" clearly stipulates: "The houses owned by the mortgagor and other things fixed on the ground can be mortgaged" and "the land use right of township enterprises cannot be mortgaged separately. If buildings such as factories of township enterprises are mortgaged, the land use rights within their occupied areas shall be mortgaged at the same time. " "Cultivated land, homestead, private plots, private plots and other collectively owned land use rights shall not be mortgaged". The misplacement of housing ownership and homestead use right in mortgage has become a deadlock for small and medium-sized enterprises to raise funds, financial institutions to realize cash and guarantee institutions to guarantee. 3. Credit management and business environment risks Inadequate information disclosure and distorted financial data of SMEs make it difficult and untrue for banks to conduct investigations before lending. China's credit system and credit management for the whole society, including small and medium-sized enterprises, have not yet formed. 4. The asymmetry of risk and income reduces the enthusiasm of banks. Although some innovative small and medium-sized enterprises have a high failure rate, successful entrepreneurship will bring high entrepreneurial income. On the other hand, bank credit financing can only obtain fixed interest income, that is to say, banks bear the financing risk and cannot share the high income brought by the success of enterprises, which leads to the asymmetry of risks and income of banks and reduces the motivation of banks to lend to SMEs. 4. The main problems that commercial banks must solve in developing the financial industry of small and medium-sized enterprises 1. The value orientation and market orientation of banks need to be adjusted. Under the situation of insufficient demand for loan business of large enterprises, commercial banks must re-examine their own market positioning and seek new business growth bases. We should focus on "maximizing value", adhere to the principle of matching income with risk, apply risk identification technology, default rate statistics and customer credit risk assessment technology suitable for small enterprises to avoid small enterprise risks, improve risk pricing ability, cover risks and costs through price increase, and finally reflect the benefit goal. 2. Small businesses should not adopt the same management mechanism as big customers. The existing "one-size-fits-all" management mechanism for financial business of large enterprises is difficult to respond correctly and quickly to the market and effectively prevent financial business risks of small enterprises.

Second, the development ideas of banking company business?

The idea is as follows:

First, set up a leading group for the development of public utilities. Classification of large projects (large enterprises), medium-sized enterprises, small and micro enterprises special classes, classification to promote breakthroughs.

Second, according to the characteristics of regional economic development, focus on developing the business of key enterprises.

Third, innovate credit business products and invest in running schools according to local conditions.

Fourth, the classification assessment of each special class.

Third, how do commercial banks develop SME credit business?

1. The development of SME credit business is the most distinctive part of the credit customer group, and its credit demand covers a large number of credit business households such as fixed assets and liquidity on and off the balance sheet, which is characterized by small single amount, short term, urgent capital demand, frequent business occurrence and difficult implementation of guarantee methods. In the medium and long term, there are some risk factors in different degrees, which have attracted great attention of major banks. (A) Due to sound risk management and imperfect organizational system, there is a lack of managers who are proficient in modern enterprise management concepts. Most business owners and managers, on the basis of basic or necessary practical experience, have a low degree of industrialization and have very limited grasp, implementation and control of the market. Due to resistance factors, small and medium-sized enterprises are relatively weak in their own strength, lack of liquidity, insufficient attention to product market research, less investment in the establishment and expansion of marketing channels, and limited by the scale of operation, it is difficult to obtain comparative price advantages, which shows that their capital is flawed. The overall financial system of small and medium-sized enterprises is not standardized, and most of them are in the accounting stage. The financial statements of financial management and cost accounting are untrue, random and opaque, and the phenomenon of inflated costs for tax avoidance, cash income not accounted for, and inflated profits for financing or corporate image is widespread. The confusion of financial management and asymmetric information directly affect the judgment of banks on enterprises. (4) There are various types, the quality of managers is uneven, there is a general problem of integrity in enterprises, and the phenomenon that enterprises deliberately cheat bank loans and maliciously evade bank debts has been repeatedly banned, which makes it difficult for banks to evaluate the credit status of SMEs. Second, the problems existing in the development of SME credit business by commercial banks (1) The concept and consciousness system of risk management. The business operation of commercial banks has a strong administrative color, and the market-oriented operation mechanism has not been fully established. In the process of enterprise management, small and medium-sized enterprises have long been ignored. The main service objects of commercial banks' corporate credit business are big customers and big projects. Design and implement the management and risk control system and policy formulation around major customers and projects, organizational structure, resource allocation, risk management, incentive mechanism, customer evaluation system and business process. From a strategic perspective, the lack of research on product design and risk measurement tools leads to the situation that credit risk management lags behind business development, which leads to a high proportion of restrictions on the operation of non-performing loans. Small enterprises basically adopt the same credit rating process as other legal persons, but based on the growth and development characteristics, there is a big gap between small enterprises and mature large enterprises. Therefore, in the current credit rating, because the asset strength index and financial index of small enterprises are not dominant, however, the growth rate of small enterprises is relatively low, which finally forms the small enterprise rating guarantee method. At present, even if the basic materials are verified, the risk is very small, and the procedures required by commercial banks are more complicated and the operation cycle is longer. In some specific business guidelines, the operability is not strong. Especially for some new businesses, the specific operation rules and precautions are not clear enough, which leads to the customer manager being at a loss in the specific operation. Three. Suggestions for commercial banks to improve the credit risk management and control of small enterprises (I) Establishing long-term loan relationship The loan decision of commercial banks is mainly made through long-term and multi-channel contact with the relevant information of loan enterprises and their owners. Because all kinds of soft information generated by long-term relationships can largely replace hard information such as financial data, partially make up for the credit gap caused by small enterprises' inability to provide qualified financial information and collateral, and help improve their unfavorable credit status. Commercial banks should focus on long-term interests when lending to small enterprises. At present, under the condition of interest rate control, the loan pricing for small enterprises is too low to make up for their risks, which will certainly reduce the enthusiasm of commercial banks for their loans. However, if commercial banks choose some enterprise loans with growth potential and establish good capital and business cooperation relations with them, they can lay the foundation for obtaining higher loan income after interest rate marketization in the future. (2) Business innovation. According to the characteristics of small enterprises, broaden the application space of existing financial products and develop suitable financial products. Commercial banks should increase the types of financial products and use modern financing tools more conveniently to gain benefits for commercial banks. (III) Strengthening post-loan management Post-loan management is the key link of credit risk supervision and the last pass of credit risk prevention, which must be done well and strictly. Leaders should attach great importance to it and improve the post-loan management accountability system. The person in charge of post-loan management should visit regularly, carefully analyze the financial report of the enterprise, check the production status of products, inventories and fixed assets, and analyze and judge the risk status of credit assets. At the same time, it is necessary to understand the situation of the industry in which the enterprise is located through field visits, on-site discussions, communication with third parties, etc., and timely and accurately understand the major changes of the borrowing enterprises. (d) Pay attention to the training of credit officers. The characteristics of credit risk of small and medium-sized enterprises determine that loan banks must have superb management level and strong sense of responsibility. This requires commercial banks to introduce and cultivate high-quality credit talents with professional knowledge and basic knowledge of finance. In addition, we should also establish a perfect mechanism for the selection, training, assessment and reward and punishment of loan officers, and earnestly strengthen the performance management and assessment of loan officers. It is necessary to provide professional training and guidance to loan officers regularly or irregularly, and increase the exchange opportunities between loan officers, which is conducive to the improvement of loan officers' business ability. Only by comprehensively improving the management quality of credit personnel and regularly training them, so that they can master more business knowledge, understand more national policies and be familiar with the market information of various products, can the credit risk be truly minimized and the real-time early warning of loan risk be truly achieved. [2] Guan Min. Analysis on Credit Risk Management of China Commercial Bank [J]. Coastal Enterprises and Technology, 2007(3):33-34.

Fourth, how commercial banks carry out credit business for small and medium-sized enterprises.

1. Risk factors of developing credit business of small and medium-sized enterprises. As the most distinctive part of bank credit customers, the credit demand of small and medium-sized enterprises covers fixed assets, liquidity and other off-balance-sheet credit businesses. At the same time, they have the characteristics of large number of customers, small single amount, short term, urgent demand for funds, frequent business and difficult implementation of guarantee methods. Small and medium-sized enterprises are generally in the initial stage and growth stage, and there are some risk factors in different degrees, so they have attracted great attention from major banks. (A) Management risk factors Most small and medium-sized enterprises have imperfect corporate governance structures and organizational systems, and lack managers who are proficient in modern enterprise management concepts. Most business owners and managers lack the necessary theoretical basis or practical experience in the process of business management, and their overall quality and post specialization are low, and their ability to grasp the market, organizational execution and control is very limited, and their ability to resist systemic risks is weak. (II) Market risk factors Small and medium-sized enterprises are relatively weak in their own strength, lack of liquidity, insufficient attention to product market research, establishment and expansion of marketing channels, less investment, limited by the scale of operation, it is difficult to obtain comparative price advantage, capital liquidity has obvious defects, and the overall ability to resist market shocks is relatively weak. (3) Financial risk factors The financial system of small and medium-sized enterprises is not standardized, and the financial management of most enterprises still stays in the accounting stage, and the role of financial management and cost accounting has not been fully brought into play. Financial statements are untrue, non-random, opaque, inflated costs for tax avoidance, cash income is not accounted for, and inflated profits for financing or corporate image are not uncommon. The confusion of financial management and asymmetric information directly affect the judgment of banks on enterprises. (IV) Credit risk factors The ownership types of SMEs are diverse, the quality of managers is uneven, there are widespread problems of integrity in enterprises, and the phenomenon that enterprises deliberately cheat bank loans and maliciously evade bank debts has been repeatedly banned, which makes it difficult for banks to evaluate the credit status of SMEs. (1) The concept and consciousness of risk management are backward. China's commercial banks are born out of the planned economy system, and their business operations are more administrative, and the market-oriented operation mechanism has not been fully established. In the process of enterprise management, SMEs have not been regarded as potential customers for a long time, and credit risk assessment and management of SMEs have not been paid attention to in business philosophy and consciousness. State-owned commercial banks, in particular, mainly serve big customers and big projects, and the management and risk control systems and policies are designed and implemented around big customers and big projects. Organizational structure, resource allocation, risk management, incentive mechanism, customer evaluation system and business process are all formulated for large customers and projects, which leads to a lack of strategic understanding of the risks of small and medium-sized enterprises and insufficient research on product design and risk measurement tools. (B) Commercial banks' small business loans have limitations in small business rating and credit granting. Because small enterprises basically adopt the same credit rating process as other legal persons, based on their growth and development characteristics, there is a big gap with mature large enterprises. Therefore, in the current credit rating, the asset strength index and financial index of small enterprises are not dominant, while their growth and technical index are relatively low, which eventually leads to the relatively poor rating of small enterprises. At present, even if the risk of verifying basic materials is small, the procedures required by commercial banks are complicated and the operation cycle is long. In some specific business guidelines, the operability is not strong. Especially for some new businesses, the specific operation rules and precautions are not clear enough, which leads to the customer manager being at a loss in the specific operation. Three. Suggestions for commercial banks to improve the credit risk management and control of small enterprises (I) Establishing long-term loan relationship The loan decision of commercial banks is mainly made through long-term and multi-channel contact with the relevant information of loan enterprises and their owners. Because all kinds of soft information generated by long-term relationships can largely replace hard information such as financial data, partially make up for the credit gap caused by small enterprises' inability to provide qualified financial information and collateral, and help improve their unfavorable credit status. Commercial banks should focus on long-term interests when lending to small enterprises. At present, under the condition of interest rate control, the loan pricing for small enterprises is too low to make up for their risks, which will certainly reduce the enthusiasm of commercial banks for their loans. However, if commercial banks choose some enterprise loans with growth potential and establish good capital and business cooperation relations with them, they can lay the foundation for obtaining higher loan income after interest rate marketization in the future. (2) Business innovation. According to the characteristics of small enterprises, broaden the application space of existing financial products and develop suitable financial products. Commercial banks should increase the types of financial products and use modern financing tools more conveniently to gain benefits for commercial banks. (III) Strengthening post-loan management Post-loan management is the key link of credit risk supervision and the last pass of credit risk prevention, which must be done well and strictly. Strong leadership skills.