The study explores non-financial factors which affect loan default for SMEs (small and medium enterprises), and create a predicting model for SMEs loan risk therewith. The object of this study is the SMEs loan customers of a commercial bank's branches located in Taiwan. The study gets 154 normal cases and 52 default cases by the ratio of 3:1 approximatively. The survey data were analyzed using chi-square test and logistic regression. According to the result of this research, in terms of non-financial factors, the ratio of default businesses were significant differences on the elements of different industries, period of establishment, collateral, relationship with banks, age of the person in charge and whether the person in charge of uses the credit line of cash card or revolving line or not. Finally, this study makes use of the non-financial factors, which have discriminating applicability to be the forecasting factors, and creates a loan default precaution model for SMEs thereby; the accurate ratio of the forecast is more than 85%. We hope the result of this study can help financial institutions to set up their SMEs loan risk evaluation model and adopt some key reference factors therein.