A guarantee company blindly raised funds. Some guarantee companies claim that there are entities behind them, and there are many assets that can be used as guarantees to finance. Some companies do use them in their own projects after financing. As long as the quality of the project is high and the internal management of the company is stable, it can, at least, show that the company is responsible for the funds of investment customers. And some companies, after financing a lot of money, can't use that much money in the original entity enterprise, but they can't tell customers that the project doesn't need money, and they are afraid that customers will pay collectively when it is due, so they try their best to find some new projects to operate. This is very blind. It is necessary to know that being an entity enterprise is accumulated bit by bit, and it is not entirely possible to rely on money. This kind of temporary project often takes a long time and has great risks in later operation. Once the enterprise lacks its own profitability and cash flow, because the principal of the customer is ultimately supported by the company's profits.
Second, some companies lend at high interest rates. These companies are often third-party investment guarantee companies. In recent years, with the development of economy, some emerging financial models have gradually emerged. Investment guarantee company is one of them. As a third-party investment and financing platform, they let customers with spare money invest, give them a certain standard interest, and then lend at high interest rates. Real estate companies are the most common lenders, but there is no perfect credit supervision system in China. Whether the loan money can be recovered in full and on time depends entirely on the borrower's integrity. Once the national economic environment changes and enterprises are unable to repay loans, the capital chain of guarantee companies will be broken and investment customers will be damaged. In addition, the more the guarantee company goes wrong, the more some borrowing companies default on their debts, which leads to a vicious circle of guarantee companies.
Third, some companies have impure motives. Some companies use high interest rates as bait to attract investment customers through deception or similar pyramid schemes. This is because the company's own motives are impure, that is, it is doomed to have an accident, and investors should keep their eyes open.
The above is the reason why I summarized the accident of the guarantee company. They may not be comprehensive, but they are enough to remind investors. Before investing, you must have a deep understanding of the company, and you must know the whereabouts of the funds, the future repayment source of the borrower, and whether the total assets match the loan amount. Or my personal point of view, the client's principal is based on the profitability of the borrowing enterprise, and the profitability of the borrowing enterprise is the guarantee for recovering the principal in the future.
Investment is risky and financial management needs to be cautious.