PaymentsJournal
No Result
View All Result
SIGN UP
  • Commercial
  • Credit
  • Debit
  • Digital Assets & Crypto
  • Digital Banking
  • Emerging Payments
  • Fraud & Security
  • Merchant
  • Prepaid
PaymentsJournal
  • Commercial
  • Credit
  • Debit
  • Digital Assets & Crypto
  • Digital Banking
  • Emerging Payments
  • Fraud & Security
  • Merchant
  • Prepaid
No Result
View All Result
PaymentsJournal
No Result
View All Result

Chinese Credit Scoring: Creepy or Spooky

By Brian Riley
December 10, 2018
in Analysts Coverage, Credit
0
2
SHARES
0
VIEWS
Share on FacebookShare on TwitterShare on LinkedIn
china credit score

china credit score

It is hard to beat the good old FICO Score.  If you want to know the basics, all you need to do is go here and simulate your score. Or, you could look at the product sheet. You could even go to one of your creditors and likely see the FICO Score for free.  In any case, you will find the attributes are credit-centric: How you pay, How much you owe, and how much credit you utilize.

That’s all fine and well, but what do you do in a market of 1.35 billion people, when credit is still a novelty?  This article in ScienceNordic talks about the development of credit systems in China, and how the focus is more on social attributes than hardline credit data.  Even the title is a bit scary: Is China’s social credit system really the dystopian sci-fi scenario that many fear?

  • British journalist James O’Malley was on the Beijing-Shanghai bullet train last month when he heard a disturbing announcement.
  • “Dear passengers, people who travel without a ticket, or behave disorderly, or smoke in public areas, will be punished according to regulations and the behavior will be recorded in individual credit information system. To avoid a negative record of personal credit please follow the relevant regulations and help with the orders on the train and at the station.”
  • Indeed, what disturbed James is China’s widely discussed and severely criticized Big Brother-style social credit system. But before we get carried away to 1984, let’s get a more comprehensive overview of the system, including some misunderstood or lesser-discussed aspects.

Can you fast forward the development of a scoring system in an authoritarian government? Or should you focus on credit with “Just the Facts”, as they say in Dragnet?

  • It was first referred to in 2014 in a government document (in Chinese) issued by the State Council—the highest executive organ of state power in the People’s Republic of China. The document described an omnipotent social credit system due to be launched in 2020, which aims to rate everyone’s “trustworthiness.”
  • The ‘credit’ referred to in the unnerving train announcement is the translation of the Chinese word ‘xinyong,’ which indicates a person’s honesty and trustworthiness.

The scoring process is still in development but there looks like subjectivity, rather than facts might drive the process.

  • All 1.35 billion Chinese citizens will be subjected to the system. People with high scores will enjoy better social privileges and economic benefits. Low scores on the other hand, could get you blacklisted from accessing certain services, such as flights or train travel – just as James heard on the train.
  • The potential for misuse and the likelihood of mishandling personal, private data is easily drawing public attention in today’s data-sensitive era.

Too much data?  Or, off on the wrong tangent?

Just the facts, Ma’am.

Overview by Brian Riley, Director, Credit Advisory Service at Mercator Advisory Group

2
SHARES
0
VIEWS
Share on FacebookShare on TwitterShare on LinkedIn
Tags: ChinaCreditCredit ScoreFICO

    Get the Latest News and Insights Delivered Daily

    Subscribe to the PaymentsJournal Newsletter for exclusive insight and data from Javelin Strategy & Research analysts and industry professionals.

    Must Reads

    Amazon, Visa, and the UK: Credit Card Retail Wars and My Rewards, Amazon Pay cash load

    Trouble at Home: A Second Flop in Credit Card Rewards

    December 16, 2025
    mastercard merchant

    Payments Simplicity Is Still Key for Most Shoppers

    December 15, 2025
    cross-border tokenized deposits

    Ant International and HSBC Pilot Cross-Border Tokenized Deposit Transfers on Swift

    December 12, 2025
    Fiserv stablecoin

    Three Small Business Trends That Banks Can Hop On in 2026

    December 11, 2025
    echeck

    Beyond Paper: Why More Businesses Are Turning to eChecks

    December 10, 2025
    metal cards

    Leveraging Metal Cards to Attract High-Value Customers

    December 9, 2025
    fraud as a service

    Keeping Up with the Most Dangerous Fraud Trends of 2026

    December 8, 2025
    open banking

    Open Banking Has Begun to Intrude on Banks’ Customer Relationships

    December 5, 2025

    Linkedin-in X-twitter
    • Commercial
    • Credit
    • Debit
    • Digital Assets & Crypto
    • Digital Banking
    • Commercial
    • Credit
    • Debit
    • Digital Assets & Crypto
    • Digital Banking
    • Emerging Payments
    • Fraud & Security
    • Merchant
    • Prepaid
    • Emerging Payments
    • Fraud & Security
    • Merchant
    • Prepaid
    • About Us
    • Advertise With Us
    • Sign Up for Our Newsletter
    • About Us
    • Advertise With Us
    • Sign Up for Our Newsletter

    ©2024 PaymentsJournal.com |  Terms of Use | Privacy Policy

    • Commercial Payments
    • Credit
    • Debit
    • Digital Assets & Crypto
    • Emerging Payments
    • Fraud & Security
    • Merchant
    • Prepaid
    No Result
    View All Result