Relationship between China’s Nonofficial Finance and SMEs

Survey Explores Symbiotic Relationship between China’s Nonofficial Finance and SMEs

YU Qune1( 虞群娥) and LI Aixi2( 李爱喜)
1Professor and Ph.D. of the School of Finance at Zhejiang University of Finance & Economics
2Associate Professor and Ph.D. of the School of Finance at Zhejiang University of Finance & Economics

Editorial note:In China, there was a long period of time that nonofficial finance was referred to as “black finance”, receiving widespread disapproval. The perennial financing difficulty facing China’s small and medium-sized enterprises (SMEs), however, turned out to be a turning point for the development of nonofficial finance in China. This article is intended to present the findings of an empirical study of the symbiotic relationship between nonofficial finance and SMEs from the perspective of induced institutional change, using representative firsthand data from China’s most dynamic province-Zhejiang.

I. Literature review: a review of relevant theories on the mutual symbiosis between nonofficial finance and SMEs

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