Central Bank Zhang Jin: opening up the "Last kilometer" of Rural Finance

Economic observation Network reporter Wu Qiaofa rural financial services "the last kilometer" to be opened. Based on the production characteristics of rural areas, the funds needed by farmers often have problems such as small amount, high cost and lack of effective mortgage, which to a certain extent restricts the issuance of agricultural loans by traditional financial institutions, and the problem of farmers' financing is still prominent.

"the birth of Internet finance provides a new vision and path for solving the problems of agriculture, rural areas and farmers." Zhang Jin, director of the Financial Consumer Rights Protection Department of the Guangzhou Branch of the people's Bank of China, revealed that since August this year, under the planning and promotion of the Guangzhou Branch of the people's Bank of China, four Internet financial enterprises, including PPmoney, Guangzhou e-loan, point-raising finance, and Zhengqin Finance, have solved the loan difficulties of rural farmers by crowdfunding and opened up the pilot work of the project of "the last kilometer" of funds for supporting agriculture.

The so-called crowdfunding means that the project and investors are directly connected through the network, and anyone can send their own entrepreneurial ideas or related projects to the crowdfunding platform, which will be released after being examined by the crowdfunding platform, and netizens will voluntarily give financial support. The reward is the corresponding product or service.

In order to further improve the feasibility and promotion of the crowdfunding project of "Internet + Credit, Agriculture, Countryside and Farmers", Qiu Bin, deputy governor of the Guangzhou Branch of the people's Bank of China, led a delegation to Meizhou, Yunfu, Zhaoqing, Qingyuan, and four prefectures and cities to understand the situation of local agricultural construction and development and the industrial projects of key agricultural leading enterprises.

After preliminary research, after understanding the plight of farmers' financing difficulties, the above four Internet financial platforms take the local products with geographical indications as the subject matter, and the online platform released unique agricultural crowdfunding projects. The funds raised through the platform will be provided to farmers to buy seeds and fertilizers. The agricultural products produced by farmers will be sold to the relevant core leading agricultural enterprises, at the same time, the sales income obtained by farmers will pay the principal of investors' loans, and the interest earned by investors will be the high-quality agricultural products produced by farmers.

"while this financing method brings high-quality agricultural products to investors, it can also guide social funds to support the construction of agriculture, rural areas and farmers, realize the optimal allocation of funds and agricultural production factors, and promote the docking and integration of Internet finance and the real economy. to achieve zero distance between financial services and agricultural development." Zhang Jin said.

He believes that the Internet Finance + Action has opened a new door for investment and financing for rural residents and small and micro enterprises, bringing about new changes in the development of financial services for agriculture, rural areas and farmers.

The first transformation is from a financial institution facing hundreds of farmers to a large number of investors directly facing a farmer or peasant household, with high efficiency and low cost. The traditional financial model is that a financial institution conducts credit surveys in front of hundreds of farmers, each of which has the same procedure, so its cost is very high. Some people say that if you look at him to do a peasant household survey, the procedure and cost of doing a Gree credit survey and credit investigation are the same. There is a practical problem here. So many farmers have high costs and low efficiency.

Now with crowdfunding, we can change it. "after our platform investigates a farmer, it sends it online, and hundreds of investors can use the survey material and then make their own investment choices, thus improving efficiency and low cost." Zhang Jin said.

The second change, from a financial institution to bear all the loan risk to a large number of investors to share the risk, small investment, low risk. At present, the traditional way is that a financial institution has to face hundreds of farmers, and the risk of hundreds of farmers is borne by a financial institution, so the risk is very high. In other words, to turn around, we use crowdfunding, that is, hundreds of investors to a farmer, a farmer, his risk is shared by these hundreds of investors, this kind of risk is controllable and bearable.

The third change, from the traditional way to provide collateral or guarantee to farmers only need to provide social information, production credit information and credit information. Traditional financial institutions need collateral for loans. Farmers and farmers do not have collateral. Farmland cannot be mortgaged and houses cannot be mortgaged. Now we are doing this reform and experiment, but we do not need collateral by crowdfunding. What do you need? Need credit support, as long as you provide credit, when a farmer needs funds on the crowdfunding platform, he provides the farmer's own social information, whether he gambles in the village, and so on, as well as safety in production, because what our investors need is a kind of green and ecological agricultural products, I am green in the production process, is safe, and so on.

The fourth change, from farmers due cash payment of principal and interest to using agricultural products to pay principal and interest, the link is small, income diversification. In the past, the only income from traditional finance was money, and it was impossible for him to collect your agricultural products. However, for the income that a crowdfunding investor wants, apart from currency, apart from recovering the principal, he can have many choices, such as currency, agricultural products, or even principal. All of them need agricultural products, such as high-quality rice and so on.

Fifth, funds from rural areas are drawn to urban construction to attract urban funds to support agricultural development, which is new and effective. Traditional financial institutions located in rural areas often deposit deposits and raise them to the city, but the way of Internet crowdfunding is to attract urban funds to the rural areas and back-feed agriculture.

These changes are not only the changes of Internet finance to traditional rural finance, but also an effective way and new way to solve the financing difficulties of farmers and get through the "last kilometer" of financial services. On November 12, under the witness of Fan Yifei, deputy governor of the central bank, the crowdfunding project of "Internet + Credit, Agriculture, Countryside and Farmers" was launched.