Abstract
<p>Because of the financial market fast development between Taiwan and Mainland China, commercial banks, sometimes, cannot have an efficient method to investigate loan credentials for small and medium enterprises. Without efficient methods, commercial banks are forced to undertake the unnecessary default risks. The article chooses the behaviors of commercial banks between Mainland China and Taiwan to become study target. The purpose is to investigate the assessment method and influence factor of commercial banks toward small and medium enterprises for loan. Through modified Delphi approach and Fuzzy Analytic Hierarchy Process (FAHP) in multi-criteria decision-making (MCDM), the article attempts to analyze the decision-making measure of loan for commercial banks toward small and medium enterprises. From the results of practical evidence, the loan assessment measure of commercial banks between Taiwan and Mainland China is quite different. During loan assessment, China commercial banks focus on the debt-paying ability; on the contrary, Taiwan commercial banks focus on profitability of enterprises. The practical approved result of the study has supplied the insufficient data for related study articles in the past. More, the study can also be an important reference for perform related tasks in Taiwan’s and China’s commercial banks.</p>
Highlights
In 2011, Wenzhou city of China, the large-scale bankruptcy event from small and medium enterprises happened
When the default risk is increased, it increases the possibility for commercial banks that cannot retake loans and interests during operating loans for small and medium enterprises
After compiling experts’ questionnaire using advance integration, the study uses Fuzzy Analytic Hierarchy Process (FAHP) to analyze the loan assessment standard of small and medium enterprises, which is considered by loan supervisors of China commercial banks
Summary
In 2011, Wenzhou city of China, the large-scale bankruptcy event from small and medium enterprises happened. If the financial report cannot reach the standardization, it will cause relatively troubles for credit personnel It will increase operational cost of loan businesses of banks and default risks of small and medium enterprises. Many china banks depend on personal relation, government-business relation, collaterals, and land sources to evaluate the loan standard toward small and medium enterprises It is very important for commercial banks to set up a systematic, scientific and data-based loan assessment function that has financial or non-financial standard. Before setting up an objective and fair standard for loan investigation, commercial banks need to do more precise analyses and realization about loan behaviors to small and medium businesses This method can disclose some financial or non-financial factors from the past that affect loan decisions of commercial banks for a long time.
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