The changing characteristics of Agricultural Cooperative Finance in Modern China and its Enlightenment

Agricultural cooperative finance in modern China began with the experiment of rural credit cooperation conducted by Huayangyi Relief Society in Hebei in the 1920s. After the 1930s, with the depletion of traditional Chinese rural finance and the intensification of the economic crisis, cooperative finance is regarded by the national government and all walks of life as a good way to revive the rural economy and extended to all parts of the country. After the government intervened, it began to use administrative power to force forward, and gradually squeezed out social forces. After the Anti-Japanese War, a cooperative financial model dominated by government monopoly was formed. It lasted more than 20 years from the beginning of agricultural cooperative finance in modern China in 1923 to the defeat of the Kuomintang government in 1949. According to the different subjects of guidance, it has experienced three modes: the leadership of social groups, the joint guidance of social groups and the government, and the monopoly guidance of government power. Under three different guidance modes, cooperative finance presents different development characteristics.

In the 1920s, Hebei credit cooperation was completely under the leadership of the Hua Yangyi Relief Association, a social organization, and did not rely on any administrative coercive force. For this reason, Huayangyi Relief Association mainly depends on cultivating farmers' sense of cooperation, establishing a sound incentive and restraint mechanism, improving the quality of social affairs management, and attracting farmers to join the club. Therefore, the characteristics of the development of cooperative finance are as follows: (1) pay attention to the publicity and education of cooperative knowledge, farmers form cooperatives independently, and members freely enter or withdraw from cooperatives; (2) credit cooperation is the only form, and the development speed of cooperative organizations is slow. Regional distribution is limited to Hebei province; (3) the quality of cooperative organizations is good, the sense of cooperation among members is generally strong, and there is no phenomenon that a small number of bad elements control social affairs. (4) to establish a sound loan risk prevention mechanism, which can be effectively implemented; (5) the loan funds mainly rely on the relief funds of Huayangyi Relief Society, without the help of commercial finance, the loan channel is single and the loan scale is small; (6) the performance of cooperative finance is good, cooperative loans can basically be repaid on schedule, and the rate of non-performing loans is almost zero. (7) Cooperative loans can really be used for agricultural production and operation, and there is no phenomenon of being transformed into usury.

In the early 1930s, with the decline of rural economy and the drying up of finance, the government and all walks of life have to explore the path of reviving rural areas. Because of its successful development, Hebei rural credit cooperation in the early stage was regarded as a good prescription for rural relief and was vigorously promoted. As a result, the cause of agricultural cooperative finance has entered the stage of national multi-provincial development. During this period, the part of agricultural cooperative finance made use of the administrative power of the government, and has not completely ruled out the power of social groups, which is jointly led by the government and social organizations. However, with the passage of time, there is a trend that the power of the government is gradually strengthened and the social force is weakening. Under this mode, the development of agricultural cooperative finance shows the following characteristics: (1) the form of cooperative organization has developed from single credit cooperation to production, consumption, transportation and marketing, but credit cooperation is still the main form. (2) although the principle of free membership of members is retained in the system, the government exerts influence indirectly by administrative power, so it has the nature of forcing farmers to join the co-operative to a certain extent, which greatly accelerates the increase of cooperative organizations; (3) cooperative propaganda and education is a mere formality, members' cooperative consciousness is low, and the quality of social affairs management is declining. (4) Urban commercial and agricultural financial institutions have joined in cooperative loans, resulting in an upsurge of "commercial capital returning to agriculture", and the scale of loans has expanded rapidly. (5) the profit-making nature of financial institutions causes them to evade risks excessively, attach importance to mortgage guarantee and shrink credit loans in the process of issuing cooperative loans, resulting in vicious competition in cooperative developed areas, while no one is interested in backward areas. contrary to the purpose of cooperative finance, cooperative finance is alienated into commercial finance. (6) the quality of cooperative loans has declined, the rate of non-performing loans has increased, and a small number of non-performing elements have controlled cooperative loans in some areas and turned into usury.

In the late 1930s, in view of the disadvantages of "commercial capital returning to agriculture", the national government intended to establish a national unified cooperative financial system, with the state monopolizing the supply of loan funds and uniformly managing cooperative finance. commercial financial institutions are completely excluded from the field of cooperative finance. After the beginning of the Anti-Japanese War, the above plan was implemented after the Anti-Japanese War. After that, cooperative finance is brought into the national rural financial system.

Under the government monopoly guidance mode, China's agricultural cooperative finance shows the following development characteristics: (1) Agricultural cooperative finance is used as a tool to expand rural finance and increase agricultural production, which is forced by the state administrative force. the mechanism of independent organization and free advance and retreat has been abandoned. (2) the cooperative organization develops by leaps and bounds in the short term, and the distribution area expands rapidly; the cooperative organization completely loses its initiative, develops passively, and is finally alienated into a part of the rural administrative system; (3) the cooperative loan funds are monopolized by state financial institutions, the rate of non-performing loans is abnormally high, the waste of funds is serious, and it is difficult for sustainable development. (4) the development of cooperative finance is entirely based on the will of the government. if the government wants it, it will flourish, and if it wants to decline, it will decline; (5) cooperative loans are manipulated by bad elements in the society and transformed into new types of usury, and most of them cannot be used in agricultural production. The meaning of mutual assistance and cooperation is lost.

Agricultural cooperative finance in modern China was guided by social forces and spontaneously organized by farmers. After that, due to government intervention, it gradually evolved into a compulsory promotion of government administrative forces, and finally alienated into a national financial tool. With the transformation of the leading force and the evolution of the guidance model, China's agricultural cooperative finance industry shows a development trend of gradual acceleration and expansion of development scale, while the quality of cooperative organizations and loans is deteriorating day by day. Through the comparative thinking of the three different modes of modern cooperative finance, combined with the current realistic environment of China's agricultural cooperative financial reform, we can get the following enlightenment:

First, agricultural cooperative finance is essentially an economic undertaking and should follow its objective law of development. As a form of modern agricultural finance, agricultural cooperative finance must be rooted in the soil of agricultural economic and financial development, and its development speed and form of existence have strong independence independent of human will. The course of the development of agricultural cooperative finance in modern China shows that no matter what purpose it is to artificially accelerate or affect the development of cooperative finance, it will inevitably lead to the decline of the quality of cooperative finance, increase the risk, and it is difficult to achieve sustainable development, and finally lead to the alienation of cooperative finance and deviate from the purpose of mutual cooperation finance.

Second, the quality of agricultural cooperative organizations and the awareness of social cooperation are the cornerstones of the sound development of cooperative finance. The quality of social affairs management of agricultural cooperative organizations and the cooperative consciousness of members are directly related to the risk control of cooperative loans and the effective operation of many links such as the distribution and application of cooperative loans. The development of agricultural cooperation in modern China shows that under the government-led mode, the risk of agricultural cooperative loan is abnormally high, and the loan is alienated into usury, which is caused by many factors, but the direct reason is the ineffectiveness of cooperative organization management system. Therefore, in the current agricultural cooperative financial management, we should pay attention to the standardization of cooperative social affairs management, strengthen cooperative education, improve farmers' cooperative consciousness, and lay the foundation for the sound development of cooperative finance.