Loan companies are non-financial institutions, "doing financial things, do not enjoy the right to financing." The core of microfinance is microfinance. In fact, it is not just small loans, but also credit, including savings, membership fees, insurance and other services.
Small loan companies can only carry out loan business and cannot absorb deposits. They must solve the financing bottleneck and guard against the risk of illegal financing. The sources of funds for microfinance companies are mainly capital paid by shareholders, donated funds and integrated funds from no more than two banking financial institutions. Within the scope prescribed by laws and regulations.
The balance of the incorporated funds obtained by the microfinance company from banking financial institutions shall not exceed 50% of the net capital. The fundamental reason for the shortage of funds for small loan companies is that they have not really entered the financial market and are not qualified to enter the lending market and the bill market.
relevant information
(1) The loan trust adopts the form of loan in the use of funds. As long as the mortgage or pledge and guarantee procedures are implemented, the risks are generally controllable. From the perspective of income, loan trust funds are mostly used for medium and long term, and their loan interest rates are much higher than the time deposit interest rates of commercial banks. Therefore, the loan trust rate of return is attractive to investors (customers).
(2) When a trust company actively creates a trust, as long as its security and profitability are attractive enough to investors, it will usually be recognized by investors.
(3) China, like Japan when the loan trust was founded, is a late-developing country. Raising funds for medium and long-term construction and development is extremely important for promoting national economic development. As a kind of trust that can finance huge amounts of money for medium and long-term projects, loan trust will certainly have broad market prospects.