Chinese Academy of Social Sciences says the gap in agricultural, rural and farmer finance exceeds 3 trillion yuan
China's first blue book on the "agriculture, rural areas and farmers" internet finance industry - the "China 'Agriculture, Rural Areas and Farmers' Internet Finance Development Report (2016)" (hereinafter referred to as the "Blue Book") - has recently been completed by experts from the Chinese Academy of Social Sciences' National Academy of Economic Strategy, and was officially released on the morning of August 18 in the academic lecture hall of the CASS Department of Finance and Economics. The Blue Book points out that in 2014, the demand for loan investment in the "agriculture, rural areas and farmers" sector was about 8.45 trillion, and after subtracting the actual farmer loan balance of 5.4 trillion, the gap in "agriculture, rural areas and farmers" finance reached 3.05 trillion, leaving the effective supply of "agriculture, rural areas and farmers" finance seriously insufficient.
"With such a large demand gap, our financial supply is seriously insufficient. Under these circumstances, our internet rural finance emerged at the right moment," said Xu Hongcai, director of the Economic Research Department of the China Center for International Economic Exchanges.
The Blue Book points out that internet finance methods such as online lending and equity crowdfunding can, by virtue of their technological advantages, eliminate regional discrimination in finance and actively attract surplus urban funds back to rural areas; at the same time, they can effectively identify borrowing farmers with potential repayment capacity, capitalize credit, and by providing credit and small loan support to farming households lacking credit records and collateral, establish farmer credit records and lay the foundation for them to obtain traditional financial services. The accelerated development of the mobile internet, by rapidly lowering the operating costs of finance, also provides more solutions for extending finance to impoverished areas.