What is financing? Why should enterprises increase capital? What are the benefits of increasing capital?

Capital increase refers to the act of increasing registered capital according to law in order to expand business scale, expand business and improve the company's credit standing. In fact, the company's capital needs change with the development of its business activities. In particular, the company's development prospects are promising, and the demand for funds will inevitably increase. At this time, it needs to be adjusted. To increase capital, registered capital must be made according to legal procedures. According to Article 12 of the Regulations on the Administration of Registration of Enterprise Legal Persons: "The registered capital is the amount of property or its own property authorized by the state to operate and manage an enterprise legal person. If an enterprise as a legal person applies for industrial and commercial registration and the amount of funds applied for registration is inconsistent with the actual amount of funds, it shall be handled in accordance with the special provisions of the state. " Article 3 1 of the Detailed Rules for the Implementation of the Regulations on the Administration of Registration of Enterprise Legal Persons stipulates: "The amount of registered capital is the monetary expression of the property managed by the enterprise legal person or the property owned by the enterprise legal person. Unless otherwise stipulated by the state, the registered capital of an enterprise shall be consistent with the actual capital. " Financing is to obtain funds, which is generally divided into two ways: borrowing and equity financing. Its purpose is to solve the problem of insufficient funds for enterprises. Capital increase is to increase registered capital, generally in the following ways: owner's contribution, capital reserve capital increase. Function: it can improve the capital structure of enterprises, enhance the strength of enterprises, and make it easier to raise funds from the outside world. In order to maintain the scale of production and make enterprises have enough funds to ensure the smooth progress of expanded reproduction, general enterprises have formulated a system of capital appreciation and preservation, at least to maintain the original capital scale. 2. In order to expand the needs of reproduction, enterprises must do a good job in financing with financial institutions. However, some joint-stock banks attach great importance to the scale of corporate capital. If they don't reach the level of 50 million yuan, they will not be eligible for financing loans. 3, the size of the enterprise owner's rights and interests, mostly in capital, production and sales to reach a certain scale, which largely depends on enterprise capital to support. Therefore, the capital of an enterprise cannot be reduced without special circumstances, and it should be gradually increased. Therefore, many enterprises have donated this principal with their surplus reserve fund, which is the significance.