Relationship Between Credit Access and Agri-economy

摘要

With the rapid development of Chinese economy, the question of credit is becoming more and more important. Especially in China rural area, building a new socialist countryside needs the support of finance. While as we all known, the financial system in rural area is not effective enough to promote the productivity and the level of welfare of household. Credit access is composed of formal and informal financial sectors. Formal sector includes banks, credit and savings institutions, national programs,etc. Informal sector includes loans from relatives, friends, revolving credit associations, etc. All of them are playing very important role in poverty alleviation, the creation of economic opportunities and high level productivity in rural China. Lack of easy access to receive loan, inadequate institutional expansion, lack of security, excessive indirect expenditure to receive loan and high interest loan have been observed as the obstacles in the development of China rural area. To create more economicopportunities and promote the level of warfare by removing these obstacles it is necessary to make agricultural and rural credit system easily accessible to households.