Research on Financial Credit Risk Prediction Based on Supply Chain of Small and Medium-Sized Enterprises in the Steel Industry

Abstract

Based on the research of supply chain finance and risk management, this paper analyzes the development current and transform pressure of supply chain finance in Chinese steel industry under “carbon reduction” goals, and systematically describes the credit risk and influencing factors of three supply chain finance modes. We conducted logistic bivariate regression and constructed a risk prediction model for empirical analysis based on the data of National Equities Exchange and Quotations (NEEQ) enterprises from 2010 to 2019. The research indicates that credit risk is the main obstacle to funding mode innovation in small and medium-sized enterprises (SMEs) and there are differences between three supply chain finance modes: accounts receivable financing mode pays more attention to enterprises’ profitability, while inventory pledge financing mode and prepayment financing mode have higher requirements on enterprises’ quality. At present, the development of China's iron and steel industry has entered a bottleneck period, and the economic profit rate of SMEs is low. Thus, they need to select a more appropriate supply chain financing mode for supply chain financing by virtue of their own advantages and disadvantages to realize the innovation and transformation of financing mode, and at the same time decrease the loan risk for financial financing institutions and achieve benign interaction.