Relationship lending and finance problem of medium and small-sized enterprises

On the basis of the relationship between banks and enterprises, the paper firstly introduces the relationship lending which is the traditional means of foreign bank systems and it's benefits and costs. The rest of the paper expounds how to define the relationship lending in our bank system. Relationship lending is helpful in building new relation between banks and enterprises and controlling the risk. Close monitoring, renegotiability, and implicit long-term contractual agreements should characterize the relationship lending.