Characteristics of small and medium-sized enterprise financing

The characteristics of SME financing are as follows:

1. The difficulty of short-term capital financing has been reduced, but long-term equity capital is seriously lacking. Thanks to the efforts of local governments, the financing difficulties of SMEs have been eased. However, the existing financial system is only open to SMEs for short-term credit business, and the supply of medium- and long-term credit and equity capital is still seriously inadequate. Especially for a large number of high-tech entrepreneurial enterprises, what is most lacking is not short-term loans but medium- and long-term loans and equity investment, but this kind of capital can not be obtained from the formal financial system;

2. The difficulties of large enterprises in financing have been alleviated, but financing for small and medium-sized enterprises is still very difficult. In the current financial system, most financial institutions are mainly oriented to large enterprises, small and medium-sized financial institutions as the main object of the development of small and medium-sized financial institutions are lagging behind, the scope of services, service varieties are difficult to meet the needs of small and medium-sized development;

3, large and medium-sized cities have abundant funds, but the county and the following geographic area of the scarcity of funds. In recent years, the distribution of credit funds to large and medium-sized cities more and more concentrated, and some counties and the following regions and even a gap in the supply of funds;

4, the difference in ownership is narrowing, but still exists. Due to some law enforcement and auditing department conceptual problems, in practice, there are really bad loans to the state-owned enterprises will not be held accountable for bad loans to private enterprises will be held legally responsible for the phenomenon of bad loans.

Legal basis: "Chinese people's **** and the State Small and Medium-sized Enterprises Promotion Law" Article 14

The People's Bank of China shall make comprehensive use of monetary policy tools to encourage and guide financial institutions to increase credit support for small and micro-enterprises, and to improve the environment for financing small and micro-enterprises.