Obstacles and Reconstruction of China's Financial System from the Perspective of Special Needs Trusts

Abstract

China's special needs trust system provides important support for strengthening the economic life security of people with disabilities, but it has also exposed three major dilemmas in practice: “slow service implementation,” “difficulty in business development,” and “imperfect support mechanisms.” In essence, these institutional dilemmas conceal obstacles in the financial system, and these obstacles are common in most developing countries. Within the framework of a social model, this paper reveals the generation logic of the three major obstacles in China's current financial system, specifically including financial system inaccessibility and economic exclusion, institutional capacity-based approach and legal exclusion, and the absence of public responsibility and fragmented governance. Combining the “capacity-oriented” theory, this paper provides ideas for institutional reconstruction from three aspects: capacity expansion for financial accessibility, institutional transformation of legal capacity, and capacity guarantee for the public bearing layer. The contribution lies in constructing an analytical framework combining social models and competency orientations, using special needs trusts as a starting point, thereby revealing the deep institutional logic of financial exclusion and highlighting its universality and international reference value in the context of the Global South.