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Accelerating the construction of credit system in the countryside is an effective way to meet the fund demands of the "agriculture, countryside and farmers”, because it helps to prevent credit risks, improve farmers' access to credit, and reduce the cost of financial transactions. In the long run, to speed up the rural credit system construction, the important thing is to attach importance to the legal system construction for rural credit system and quicken the pace of credit reporting industry legislation. Also important is to promote the establishment of a powerful, easy-to-use rural credit information sharing platform by the aid of the leading role of the government. Keywords—Farmers; Credit rewards and punishment mechanism; Credit information; Rural credit system I. THE BASIC CHARACTERISTICS OF CURRENT RURAL CREDIT Because of the particularity of the rural economy and society, rural credit exhibits certain characteristics that are different from cities. So, in the process of building rural credit system, we need to design suitable frameworks and mechanisms that are combined with the reality of rural credit features. Overall, the unique feature of rural credit is mainly manifested in following aspects: Firstly, family is often as a credit body. In large scale, farm household is the basic production and business operation entity, and also the core unit of rural consumption. This determines the main body of rural credit is farm households. Then, personal credit registry system based on individuals is difficult to fully adapt to rural production and living ways, and emphasis should be put on families as a whole when constructing the credit reporting system. As for the credit records, in addition to personal credit information of the head of the farm household, we still need to collect information on family members, household major asset, household debt, family production, and other family-based related information. Meanwhile, with respect to urban families, rural families often have more members and more complex relations, which also make the construction of rural credit system more complicated. Secondly, there exists the layer feature in credit relationships. Credit relations in the countryside are mainly family-centered, then from family to clan, from clan to village, from the village to the town, and layer-by-layer outward, showing a circle structure characteristic. This layer structure is led and restricted by the blood and geopolitical relations, which means that closer to the home, smaller is the circle and more closely is the trust relationship. Inside such limited circles, usually there exists a "hidden credit mechanism" [1], that is to say, the "credit history" of someone in the circle is accumulated by the "word of mouth", which can be shared easily within the circle. However, with the gradual deepening of urbanization and continuous expanding of market trading range, the original limited circle of credit based on interpersonal trust will increasingly not adapted to the development trend of transformation of the rural economy in the new period. To this end, we need to gradually build up the corresponding formal credit system arrangements in rural markets. Thirdly, the credit structure is diversified. In the cities’ credit structure, formal bank credit accounts for the majority share. However, in rural areas, in addition to bank credit, various forms of informal folk credit are widespread, and occupy an important position in the credit markets. This makes the rural credit structure and financing forms more complex than in the city. Fourthly, the credit risk control is affected more by external factors. Agriculture may suffer from various kinds of disasters with high frequency and great losses, and rural production is often influenced by environment and other nonhuman factors, thus makes the farmers’ income instable. While off-farm income, such as migrant workers income, is becoming an important part of farmers' income, it lacks guarantee of stability and continuity. This situation will inevitably affect the performance ability and credit status of farmers. In many cases, farmers credit cannot be entirely controlled by farmers themselves, showing obvious external characteristics [2]. II. EXISTING PROBLEMS IN THE CONSTRUCTION OF RURAL CREDIT SYSTEM Generally speaking, rural credit system construction in China is still at an early stage and faces many urgent problems. 2016 International Conference on Politics, Economics and Law (ICPEL 2016) © 2016. The authors Published by Atlantis Press 0089 A. The construction of rural credit system lacks effective protection of laws and regulations So far, China has not yet established complete legal framework on social credit system, and especially lacks specific rules and regulations for the rural credit system construction, resulting in the construction of rural credit system in status of lawlessness and lack of legal protection. Specifically, there is no standardized guideline for the subject of collection of farmers’ credit information, the scope of information query and approach of credit information sharing; there is no legal basis for how to protect the personal privacy and commercial secrets involved in credit information; there is no rules on incentives to promise keepers and punishment to the dishonest. Obviously, the lack of legal support and protection system has become a prominent problem restricting the construction of rural credit system. B. Credit incentive mechanism is not perfect Credit rewards and punishment mechanism is the driving force for credit system to continue to function. In recent years, some regions have been taking measures such as lower interest rates, simplified loan procedures, and relaxed lines against “credit farmer, credit village and credit town”, and giving "blacklisted", no loans and other sanctions against bad faith farmers, villages and towns. From the point of actual effect, those measures have played a certain incentive effect. However, the existing credit incentive and restraint mechanisms is still confined to be used in the process of financial institutions’ lending to farmers, and has not been reflected in the wide range of areas. Some local governments have introduced skewed policies in agricultural infrastructure construction and selection of new agricultural projects to “credit town, credit village and credit farmer”, but such policies often become a mere formality due to lack of detailed implementing rules. Overall, on incentive and disciplinary forces is concerned, the current rural credit incentive and constraint mechanism is not strong, and is yet to be further improved. C. Rural credit information is difficult to collect and update Credit information of agriculture-related economic entities is distributed in a number of departments such as the tax authority, court, land department and financial institutions. For the comprehensive integration of credit information, it is necessary to build up effective mechanism of cooperation between all related departments. But currently, the credit reporting system is mainly constructed by financial institutions themselves, and is difficult to aggregate information held by the relevant departments other than financial institutions, making information collection incomplete. Moreover, farmers and rural small businesses are often unable to provide detailed and accurate financial statement information, and collection of their information can only be achieved by means of direct investigation. Because farmers and rural small businesses are large-numbered and geographically dispersed, the information gathering may be difficult and time-consuming. In addition, with the development of rural urbanization and more and more rural migrant population, the increased mobility of rural population also brings inconvenience to farmers' information collection and tracking, and even make some farmers drifted away from the credit system. D. The construction of farmers’ credit information database lack overall plans and credit information is difficult to be shared At present, China has preliminarily established personal and business credit information database led by the people's Bank of China, but the scope for information collection is narrow, especially information about the farmer is not complete. Meanwhile, in many areas, rural credit cooperatives, postal savings banks, the agricultural bank of China and other agriculture-related financial institutions, have also carried out establishment of credit archives work, resulting in the phenomenon of the same farmer having personal records at different banks and the repeated construction of farmers’ credit information database. On the one hand, this leads to enormous waste of human and material resources in credit information system construction; on the other hand farmers’ credit file established by each agriculture-related financial institution is only used for its own credit business management and not available to the outside, making it difficult to achieve resource sharing of farmers credit information among various financial institutions. III. WAYS TO PROMOTE RURAL CREDIT SYSTEM CONSTRUCTION To effectively promote the construction of rural credit system in China, it will be necessary to make innovations in credit reporting mechanism, standardize and improve credit evaluation mechanism, and perfect credit rewards and punishment mechanism. A. Giving full play to the leading role of local governments in the construction of rural credit system through innovation of working mechanism Credit information collection and evaluation of farmers has the characteristic of dispersion, and the cost of credit rating conducted by intermediaries is high. Also, the pattern that agriculture-related financial institutions undertake the construction of peasant household credit information system may encounter the bottleneck of information acquisition and sharing, beca

Study on the Path for the Construction of China's Rural Credit System