Why is there a huge gap in rural financial market?
Usually, especially when the county economy has not achieved obvious development, the traditional financial industry completely excludes the rural market, which will lead to the increasingly prominent financial exclusion dilemma in rural areas of China in the long run. The so-called financial exclusion means that some groups in society cannot enter the financial system and obtain necessary financial services in an appropriate form. At present, the main basis for judging the current situation of rural financial exclusion in China is six indicators put forward by Kempson and Wiley, namely, regional exclusion, evaluation exclusion, condition exclusion, price exclusion, marketing exclusion and self-exclusion. By comparing the rural status quo with the above indicators, we can easily find the huge financial service gap hidden behind the phenomenon of rural financial exclusion.
First, geographical exclusion. Because the rural areas are remote and the population is scattered, financial institutions will face traffic obstacles or high costs, resulting in low efficiency and inactive financial services. According to the relevant data released by the China Banking Regulatory Commission, by the end of 2009, there were nearly 3,000 townships in China without banking financial institutions to set up business outlets, accounting for about 7% of the total number of townships in China, of which 342 townships had no financial services, accounting for 12% of the total number of townships with blank financial institutions. The low coverage of bank outlets in rural areas reflects the neglect of rural markets by traditional banking.
Second, evaluate exclusion. On the one hand, rural production and operation activities are easily affected by the natural environment, with long production cycle, unstable output, poor economic benefits and uncontrollable borrowing risks. On the other hand, the countryside is a credit market with overall deviation of credit environment, and farmers lack basic financial knowledge and minimum contract spirit, so it is difficult to form a rural credit system. Based on the consideration of risk control, banks can only reduce the risk rate by setting up strict loan evaluation procedures. According to statistics, by the end of 20 15, China's agricultural loans only accounted for about 28% of all loans, which is enough to explain the current situation of rural loans.
Third, conditional exclusion. Conditional exclusion and evaluation exclusion are essentially the same, that is, the banking industry realizes risk control by raising the qualification threshold of farmers' loans. Taking the loan of rural credit cooperatives as an example, the loan conditions of rural individuals include proof of stable income, proof of repayment ability and market-oriented assets as collateral. But in fact, most farmers don't have property rights and can't borrow money by mortgage. Credit loans with high default rate not only hinder the normal development of rural lending services, but also further worsen the rural credit environment.
Fourth, price exclusion. Considering the high risk of agricultural loans, the central bank issued a document to allow rural financial institutions to have a larger and more flexible loan interest rate floating range than other commercial banks, and the interest rate floating range is much larger than that of ordinary commercial banks. Taking rural credit cooperatives as an example, the floating authority of rural credit cooperatives in most areas is 90% ~ 230% of the benchmark interest rate, and the floating range exceeds 200%, accounting for more than 70%. In addition, according to the data, rural credit cooperatives usually require farmers to pay 5% ~ 10% of the loan amount. This high fluctuation in the interest rate of rural financial institutions not only increases the difficulty of farmers' loans, but also reduces the enthusiasm of farmers to borrow from formal financial institutions.
Fifth, marketing exclusion. Marketing exclusion mainly refers to the scarcity of service personnel and the single supply of financial products in rural financial institutions. On the one hand, the data show that as of the end of 2008, every 10,000 rural population had financial institution service personnel 16.7, and the shortage of rural financial service personnel affected the breadth and depth of rural financial institution service development to some extent. On the other hand, the business types of rural financial institutions are too single, focusing only on savings and credit, and the financial supply structure is extremely unreasonable.
Sixth, self-exclusion. In some economically underdeveloped rural remote areas, due to the closed environment and lagging information, the local people's acceptance of new ideas is generally low. As financial institutions, these groups have been stripped out, excluded from the traditional financial system, but also aggravated the strangeness and distrust of traditional banks.