Rural credit cooperatives are an important part of cooperative organizations.

Since the establishment of the world's first cooperative organization, the Fair Pioneer Society, in 1844, cooperatives around the world have generally continued to grow. Although the principles, purposes, organizational systems, and management models of cooperatives have continued to change with the times.

Despite the changes and constant revisions, cooperative organizations are still moving forward with difficulty, and have become an important organizational form for human and social progress.

With the vertical deepening of market economy, my country's rural credit cooperatives are also facing difficulties and challenges.

The reform of rural credit cooperatives must resolve two major contradictions. As community-based local financial institutions that provide financial services to agriculture and farmers, the role played by rural credit cooperatives in supporting agricultural economic development is irreplaceable.

As of 2003, there were 34,900 rural credit cooperatives nationwide, with a deposit balance of 2.2 trillion yuan, accounting for 11.5% of the total deposits of financial institutions nationwide.

Especially in recent years, credit cooperatives in various places have actively opened small credit loans for farmers and joint guarantee loans for farmers, which has effectively alleviated the problem of farmers' loan difficulties.

Credit cooperatives have become the main force in rural finance and the financial link connecting farmers.

Although the reform of credit cooperatives has achieved certain results since 1997, current problems are still very prominent.

The main manifestations are: first, the property rights of credit cooperatives are unclear and the corporate governance structure is imperfect.

Property rights are unclear, leading to defects in the governance structure. The "three meetings" (members' congress, board of directors, and board of supervisors) system of rural credit cooperatives are in vain, and the internal control problem of "one person has the final say" is very serious; the phenomenon of administrative intervention is serious, and management

The system is not smooth, and the operating mechanism and internal control system are not sound.

Due to the fact that the owner is absent, there is a lack of property rights foundation for a sound and complete credit cooperative operating mechanism and internal control system, and it is difficult to implement management responsibilities; secondly, the management system is not smooth.

While strengthening the financial supervision of credit unions, the People's Bank of China has temporarily assumed the industry management functions of credit unions during the transition period. This system is not conducive to regulatory agencies' legal supervision and true implementation of management responsibilities.

As local financial institutions, local governments have unclear management powers and responsibilities for credit cooperatives. Third, they have heavy historical burdens and poor asset quality. Many credit cooperatives have operating difficulties and have high potential risks. In addition, credit cooperatives have great difficulties in terms of service methods and financing.

Channels and service means have not yet met the needs of farmers and rural economic development, and the problem of farmers' difficulty in getting loans still exists to varying degrees in many areas.

The reform of rural credit cooperatives must resolve two major contradictions.

The first is the contradiction between the nature of cooperation and the nature of commercialization.

Credit cooperatives are one of the earliest types of cooperatives to develop in European and American countries after the 19th century.

The rural credit cooperatives that started in my country in the 1950s were originally capitalized from farmers' shareholdings and had the nature of cooperative finance. However, they later evolved into government-run rural financial organizations and lost the original intention of the cooperative system.

In recent years, with the adjustment of rural industrial structure, the increasing number of farmers working and doing business, labor export, cross-regional employment, and agricultural entrepreneurship in most regions across the country, the demand for rural financial services has become increasingly strong.

But in reality, we found that: (1) Credit unions are nominally owned by members, but because the number of members’ shares is small or even getting smaller, it accounts for a low proportion of total assets, making it difficult to reflect members’ ownership of the credit union.

relationship, making the main body of ownership of rural credit cooperatives virtual or absent.

(2) Farmers hold more deposits in credit cooperatives. Although the current implementation of microcredit in rural areas has achieved some good results, farmers generally have fewer opportunities to obtain loans.

Because the movement of credit funds is a movement of monetary funds with financial institutions as the starting point and return point. For financial institutions, the first principle of issuing credit funds is repayment, that is, ensuring that the loaned funds can be returned in time. Repayment is

The essential requirement for the existence and continuation of the credit capital movement.

However, in the lending activities of financial institutions, due to the influence of various uncertain factors, borrowers default and fail to repay their debts, resulting in frequent losses of credit funds and interest income of financial institutions, that is, financial institutions are faced with the impact of credit risk.

Moreover, for a long time, information asymmetry in the game between farmers applying for loans and financial institutions issuing loans has led to the problem of difficulties for farmers to obtain loans and for rural financial institutions to obtain loans.

It is difficult for farmers to borrow money from rural credit cooperatives, and it is also difficult for rural credit cooperatives to carry out loan business in rural areas. Most of the credit funds of rural credit cooperatives are transferred to urban and township enterprises, and some rural deposit liabilities are terminated in the form of handing over deposit reserves and depositing money with the central bank.

mobility in rural areas.

(3) There are a large number of cooperative economic organizations at the township (town) level established after 1998, but they integrate rural political, economic and social responsibilities into one, and it is also difficult to fulfill the requirements of serving the development of "agriculture, rural areas and farmers".

The operating conditions of rural credit cooperatives are also a very worrying practical problem.

Most credit unions across the country have suffered a lot of historical losses.

In serious operating difficulties, on the one hand, credit cooperatives believe that agricultural operations are risky and farmers' income levels are low, and they are unwilling to provide loans to farmer members. Instead, they try to provide financial services to customers other than farmers (including urban industrial and commercial enterprises, etc.)

services to achieve the effect of resolving financial risks; on the other hand, rural cooperative members who took shares felt that the credit union's "cooperation" was not worthy of the name, and instead built unstandardized rural cooperation foundations.