Finance is the blood of the real economy, and agriculture is no exception. In the rural revitalization strategy proposed by the 19th National Congress, finance should also play a more important role. For a long time, the lack of rural financial supply has always been a bottleneck restricting China's agricultural modernization.
China's rural financial development has long been a clear contradiction between supply and demand. Financial repression is a state of existence for a long period of time. The main problem is the lack of rural financial services and the poor accessibility of new agricultural operating entities. The obstacles to the entry of new agricultural business entities into the credit market are important reasons. The obstacles lead to the lack of endogenous power for commercial financial institutions to serve the main body of new agricultural operations. In the final analysis, the problems of mortgage and risk measurement of new agricultural business entities cannot be avoided.
In recent years, with the development of the Internet and mobile Internet technologies, finance has continuously touched the Internet, and technology has continued to advance, so that finance has gradually expanded to rural areas and agriculture. The emergence of many new platforms and models has provided financial services for rural financial demand entities. At the same time, industry infrastructure such as payment settlement and credit information systems are also rapidly developing under technical support. However, most of these advances are concentrated in the geographical concept of rural areas. The problem of mortgage and risk measurement of new agricultural management entities is still difficult to solve. The financial breakthrough of the agricultural industry concept is still groping.
Nowadays, the prevalence of blockchain finance seems to provide new ideas for solving the problem of agricultural financing difficulties, and does not say how to end, at least it provides new ideas and possibilities for the decentralization of its characteristics.
The 100 billion-level "cake" to be developed
Perhaps it is the long-term ideological inertia, and the projects on agriculture often lead to grief associations about feelings. In an era when this sentiment has been played badly, the ideals and the purity of the pursuits have made the agricultural project sadly pitiful. But this is definitely a misunderstanding.
Today, most of China's rural areas are no longer immersed in the suffering and heavyness of Yu Hua's "Living". The laughter and anger of everyday life is more real and amiable. Most farmers have already met the basic needs of life and began to pursue their own happy life. Sensitive people will naturally find that new opportunities are emerging behind the changes, and agricultural finance may be the most noteworthy.
Since the beginning of the agricultural industrialization in China in the mid-1980s, the rural first, second and third industries have begun to integrate and develop. In the process of agricultural industrialization, various new types of business entities have emerged, including family farms, large professional households, farmer cooperatives, and leading enterprises. This has become an important part of rural society and the backbone of agricultural development. They are engaged in planting and breeding, and they are farmers in nature. However, through years of wealth and experience accumulation, they also have strong commercial attributes, which are similar to the new operators of American farmers and large-scale farms in Europe.
Under their efforts, the agricultural industry as a whole has maintained a stable development, from the traditional way of relying on food and artificial production to the modern agricultural transformation with capital intensive, high investment, high profit and low risk, and there is a gradual acceleration trend. From the perspective of recent years, the trend of scale of agriculture is very obvious, and all kinds of agricultural industries such as aquaculture have obvious scale trend. Scale can achieve lower cost, higher quality, stronger bargaining power, greatly reduce risk and increase profits, but also requires a large amount of capital investment.
The capitalization of large-scale and industrialized operations is relatively high. The demand for financial services includes small, short-term and decentralized seasonal capital temporary turnover demand, as well as long-term, large-value and concentrated sustained fixed investment demand. The development of large-scale, mechanized agriculture, such as family farms and large professional households, requires the introduction of fine varieties, land transfer, and purchase of modern machinery and equipment; this process requires the support of working capital; enterprises need to build factories, purchase machinery and equipment, and develop machinery and processing industries. The establishment of cold storage, etc., also requires liquidity support... The financial needs of various business entities have become a huge financial industry chain.
The market is huge, and the government has generously provided preferential policies including financial subsidies, tax incentives, and financial policy incentives. However, in recent years, the development speed of agricultural finance is still very slow, not proportional to the speed of agricultural development, and the contradiction between agricultural finance supply and demand is increasing. .
The "Blue Book of Internet Finance" of the "Three Rural Issues" released in August 2016 shows that since 2014, China's three rural financial gap has exceeded 3 trillion yuan, which has already calculated the annual GDP of Beijing and Shanghai in 2016. Behind it, the share of agricultural finance is not to be underestimated. According to some surveys, only one-third of the farmland's arable land transfer can create a mortgage market of more than 200 billion yuan per year.
From the current situation, although the added value of agriculture, forestry, fishery and animal husbandry industry accounts for nearly 10% of GDP, the loan obtained accounts for less than 2% of the total loan balance of financial institutions. A 100 billion-level “cake†is getting better and better. Big.
"Chicken ribs" or "turtles"
In the financial sector, which is driven by commercial value, the profit-seeking property is the biggest driving force. In the face of such a large market, it is naturally indifferent, and naturally there are reasons.
First, the risks of agricultural finance are higher. The nature of agriculture determines that its risk is greater. Risk factors such as climate, disasters and epidemics are difficult to measure, and operational risks are difficult to control, thus increasing the non-performing loan ratio to a certain extent.
From the perspective of the non-performing loan ratio of financial institutions, the representative non-performing loan ratio of commercial banks is around 1%, and the non-performing rate of agricultural loans is nearly double that of 2.4%. This also includes loans from large-scale agribusinesses, and the rate of non-performing loans in rural microfinance will be higher. Not only ordinary commercial banks, the non-performing loan ratio of state-owned large commercial banks is not optimistic. Taking a representative agricultural bank as an example, the rural household loan has the highest non-performing rate in the various (among other) personal loan business of the Agricultural Bank, exceeding 3.5%. It can be seen that in the field of risk prevention and control in the field of rural microfinance, even the agricultural institutions that serve the “three rural†professional institutions have not found a suitable way to crack.
Second, the benefits of agricultural loans are not optimistic.
The lack of optimism is mainly due to the high cost of agricultural finance. From the perspective of operating costs, due to the huge difference in production cycle and income of different crops and cultures, financial institutions need to provide customized solutions on demand, with large manpower input and high transaction costs. At the same time, because rural economic activities are still relatively backward compared with cities, it is often difficult for financial institutions to establish operating outlets in rural areas to obtain good returns, and to some extent hinder the possibility of cost sharing.
Therefore, in the traditional financial perspective, whether from the perspective of risk control or cost-benefit, agricultural finance is like a “chicken ribâ€, tasteless, and abandoned, is not a good business.
However, if you break away from the barriers of traditional finance and look at the problem with a higher eye, you will find that agricultural finance is more like a "turtle" than a "chicken rib". It tastes delicious but has no mouth.
Specifically, the basic financial elements are removed, and the difficulty of agricultural enterprise loans is largely due to the serious information asymmetry between credit and financial transactions triggered by imperfect credit information systems. The imperfect credit system to a certain extent makes the rural financial lending service over-reliance on mortgage guarantees, etc., but this method has huge incompatibility in the agricultural field.
Ma Zhiwei, chief risk officer of Agricultural Bay Financial Services, said: “The traditional agricultural production model is dominated by individual business. This kind of unorganized agricultural behavior often makes the income unable to cover the risk. Secondly, the asymmetry of information leads to the lower income of most agricultural projects. The main reason is that China's financial institutions still rely on traditional mortgage models, but for agriculture, there is generally no commodity that can be used for mortgages, so it is difficult to obtain funds from banks. This is the current rural financial innovation development. The main factor of stagnation."
One of the biggest differences between rural finance and urban finance is the lack of collateral. Prior to this, many current laws in China clearly stipulated that the contracted land management rights of cultivated land could not be used for mortgages. Under the current land system, land mortgages still lack sufficient legal basis. Although in October 2016, the relevant documents issued by the State Council indicated that it was necessary to speed up the separation of land rights, and also made some positive progress. In more than 200 counties (cities, districts) across the country, the management rights of rural contracted land were mortgaged. The loan pilot, but as one of the country's fundamental systems, the land system reform still needs the central government to make breakthroughs on major issues. However, from the current point of view, the rural financial business is mostly secured by mortgage loans, and the collateral for guarantees is single, basically the land contractual management right, the right to use the house site and the house. Even if the land system is liberalized, it is still not enough to solve the problem completely for agricultural finance with a huge demand gap.
With the continuous development of the agricultural economy, new business entities such as large-scale planters, family farms, and social investors are constantly appearing, and there are new demands for financial services. The scale and risks of financial needs such as production investment, agricultural machinery, and sales links are large. However, for the above, the above-mentioned universal secured collateral has limited mortgage value and unstable ownership, and the land contractor and contractor are prone to disputes. At the same time, the bank evaluates the new business entity lending based on a certain period of income rights. The land operator obtains a limited amount of loans, and the bank's assessment difficulty is still very risky, which affects the investment enthusiasm and production input of large-scale business entities. .
In summary, how to control the risk while expanding the scope of collateral and open up the mortgage channel for agricultural products and production materials has become the crux of solving the problem of agricultural financing. The emergence of blockchain finance provides a new idea and solution.
Blockchain thinking solution
The concept of blockchain involves many complicated technical concepts, but the so-called "avenue to simplicity", throwing away complex attributes, its "decentralization" is actually not difficult to understand. For example, if you want to buy a TV, in the process, you will generally trade with the seller. This transaction involves third parties (either home appliance stores or Taobao Jingdong are third parties), you and the manufacturer. The transactions are all around the third party. Therefore, although you simply bought a TV, you and the manufacturer must provide extra funds and information to third parties. Decentralized processing will be more convenient. The two people do not need a third party to trade, but instead use the public to testify. Imagine that if there are tens of thousands of transactions in progress, the decentralized approach will save a lot of resources, making the entire transaction autonomous and simplistic, and eliminating the risk of being controlled by the centralized agent. Decentralization is the subversive feature of blockchain technology, which realizes a point-to-point direct interaction, which makes the information interaction mode of high-efficiency, large-scale and non-centralized agents become a reality. In short, the transaction is restored. Original form.
Looking at a real case, Maersk is the world's largest shipping company, whose main business is to transport goods from one country to another. Although it sounds like a very simple business model, there are a lot of involved parties to accomplish this. Earlier this year, Maersk and IBM worked together on a blockchain pilot project to track the import and export of flowers between Africa and Europe to improve the efficiency of cross-border supply chains. Save costs and reduce risk.
Specifically, many flower farmers in Kenya make a living by planting flowers, and the world's largest flower trading market is in the Netherlands. Flowers in Kenya need to be shipped from Kenya to the Netherlands via Maersk's ocean freighter. From flowering to marketing, there are many involved parties in addition to Maersk's shipping services. In Kenya, flower farmers and exports are subject to bank loans. Before the flowers are exported, they need to be inspected by the inspection and quarantine department. The local customs clearance is required. When Maersk’s 10,000-ton ship is full of flowers and has arrived in the Netherlands after about 20 days of sailing. The previous series of processes will have to happen again, but this time it was replaced by the Dutch customs, the Dutch inspection and quarantine and the Dutch banks. In this multi-national supply chain process that lasts nearly 20 days, there will be nearly 10 participants and more than 200 related documents. In the industrial chain and logistics system of the flower trade, the big reason for the complexity is the flow of the flowers themselves, as well as the information flow of the corresponding documents and the cash flow of the loan financing. In the traditional solution, all relevant participants are a center, and relevant data and information are stored in their own databases, especially in industries such as finance. Such systems are even called core systems, and sharing is very difficult. . In the process of cross-border trade of flowers, the information, documents and funds related to flowers flow in different centers, naturally there are some inevitable shortcomings, such as: long process cycle, many links, poor transparency, etc. Affects credibility and efficiency.
The introduction of blockchain technology is to make data and assets from central storage to sharing between different entities through technical means, in a "decentralized" or "weak center" manner, while achieving transparency and traceability. And can not be falsified, from the center of each stage to the nodes within the large system, so as to grow a shared database book that everyone to maintain and update. Throughout the 20-day transnational logistics process, all participants have the right to update and enjoy the data, and relevant data and documents will be written into the shared ledger. Since all the data and documents related to the goods are written into the blockchain at any time, and the data of the participating nodes of the blockchain are kept in sync, the relevant participants, whether they are producers, sellers, or Customs, banks, etc. can understand the planting, growth, location, status, and even temperature and humidity information of the goods at any time and any place.
This case seems to be just a matter of finance, but it provides a solution for mortgages and credit systems. Extending to the field of agricultural finance, financial institutions can also use the “decentralization†approach to allow agriculture to share information from production to sales, so as to grasp the flow of information throughout the process and to grasp production and sales trends through information flow. Fill in the deficiencies of mortgages and information systems.
future? A long way to go!
For the problem of agricultural loans, the blockchain does provide a new solution. The main reason for the difficulty in obtaining loans from agriculture is the lack of effective collateral. In the final analysis, there is a lack of credit collateral. The blockchain is based on the decentralized credit foundation. It goes beyond the geographical limits and can play the role of high-efficiency and low-cost value transfer that cannot be replaced by traditional financial institutions. When a new agricultural business entity applies for a loan, it needs to provide corresponding credit information, which requires relying on the corresponding information data recorded by the bank, insurance or credit reporting agency. However, there are problems such as incomplete information, inaccurate data, and high cost of use. The use of blockchain is to rely on program algorithms to automatically record massive information and store it on every computer in the blockchain network. Information is transparent and falsified. High difficulty and low cost of use. Therefore, when applying for a loan, it no longer relies on banks, credit bureaus and other intermediaries to provide credit certificates, and the lending institution can retrieve the corresponding information data of the blockchain.
Because of this characteristic, Australia, Israel, Russia and other countries have begun the layout of agricultural finance in the blockchain field, and many agricultural institutions in China have also begun targeted experiments.
In the long run, the addition of blockchain technology can not only use new technologies, but also introduce financial services such as microfinance loans to farmers, agriculture and rural areas, and expose individual individual farmers and small and medium-sized agricultural operators that cannot be covered by traditional finance. It has realized the trust of agricultural production and realized the whole process of monitoring. While solving the problem of food safety food supply, it can also increase the income of farmers, which is a huge driving force for the comprehensive development of agriculture.
However, from the current point of view, the blockchain is still in the concept stage whether it is technology or scene, and the specific application direction needs to be explored.
First, the technology itself has to be optimized. Many people think that blockchains are very large, ubiquitous and highly interconnected. However, from the current application point of view, at the beginning of the blockchain, its underlying technology still has certain constraints. Agriculture is a living industry that needs to further break through the technical constraints of blockchain and the integration of agriculture.
Second, blockchain technology has a high barrier to entry. Blockchain technology actually involves many interdisciplinary and cross-disciplinary technologies in cryptography, computational mathematics, artificial intelligence, etc., and general engineers may be difficult to master in the short term. Agricultural informationization is still the "short board" of national informationization. At present, the most lacking is the agricultural informationization talents. Those who understand agriculture do not understand information, those who understand information do not understand agriculture, and the blockchain as a A new type of computer example, the application in the agricultural field is already a few times slower than the Internet and agriculture, so to a certain extent, the blockchain technology has once again increased the threshold.
Finally, the application scenarios of blockchain technology need to continue to expand. At present, most of the blockchain application scenarios can be divided into virtual currency classes, record notarization, smart contracts, securities, social affairs, etc. These scenarios are currently not very close to agriculture, lacking the application of agricultural and rural characteristics and grounding gas. Scenes. The blockchain is based on the Internet. In the process of opening up the rural Internet market, enterprises must constantly expand the application of the blockchain. As long as they have a large user base to participate in the blockchain, its value can only be reflect.
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