Rural Credit Cooperatives have existed in China for more than 50 years. Development of rural credit cooperatives was an important part of reforms in China. Performance of the rural credit cooperatives in China improved consistently and by September 2007, loans from rural credit cooperatives constituted 12.3% of all financial loans in China.
The history of rural credit cooperatives in China dates back more than 50 years. The rural economy of China has benefited greatly from the effective performance of rural credit cooperatives. The development of the rural credit cooperatives in China constituted an integral and important part of rural reforms in China.
A strong supervision system established to reduce the risks related to rural credits has played a major role in the success of the rural credit cooperative system in China.The performance of rural credit cooperatives in China has improved consistently over the decades.
By 2001 year-end, aggregate deposits with rural credit cooperatives in China amounted to 1.73 trillion Yuan.This was 12% of total overall deposits with all financial institutions in China. The rural credit cooperatives contributed 11% of the total outstanding loans of China. The total outstanding loans of rural credit cooperatives in China at the end of 2001 were 1.2 trillion Yuan.
According to latest available estimates of December 2007, non-performing loans by rural credit cooperatives in China dropped to 9.2% by September 2007. While availability of capital had been a major problem area for rural credit cooperatives in China, significant development has been possible in this regard. From -8.5% at the end of 2002, capital adequacy ratio increased significantly to reach 10.9% at the end of September 2007.
Highlights of the Performance of Rural Credit Cooperatives in China:
The highlights of the performance at the end of September 2007 are as follows –
4.4 trillion Yuan of outstanding deposits (593.9 billion U.S. dollars)
3.2 trillion Yuan of outstanding loans.
Loans from rural credit cooperatives constituted 12.3% of all financial loans in China.
Loans to agriculture amounted to 1.49 trillion Yuan.
77.42 million households in rural China received a total loan of 1.22 trillion Yuan.
Last Updated on : 30th July 2013