In Order to Be Relevant in China, Micro Finance Has to Adapt to Local Reality

You don't know enough about rural credit market in China if you thought:
1. There is only two types of financing available: large loans from state banks and micro-loans from NGOs
2. China doesn't have a healthy micro finance infrastructure
3. Since micro finance is so successful in Africa and Bangladesh, micro finance in China should closely follow the Grameen model

The fact is,
1. There has been a long tradition of small private finance in rural China
2. The Chinese state, since the early Song dynasty, has long recognized the role rural credit plays in peasants' well-being
3. There are a diverse set of channels already exist in rural China to dispense small loans to peasants.

In the following posts, I will try to make my point clearer. As a primer, I want my readers to watch this program.

It is a TV show first aired in last Dec. The platform is a talk show on CCTV (China Central TV), called "Dialog". This program is a popular show among serious viewers who are interested in in-depth discussion on many facets of the Chinese economy.

In this recording, the program invited to the show a group of officially chartered private lenders--a relatively new phenomenon, and a group peasants from poor areas in China. They sat face to face and discussed the needs for small loans in rural China, the functions and goals of private small loan lenders and how this new development may change credit market in rural China.

Currently, the program is only available in Chinese (Mandarin). I have been trying to add the English transcript to it since last month. For many reasons, this is still an ongoing project. But it will be here soon.