Great progress in establishing Chinese personal credit database: analyst

Source:Global Times Published: 2019/3/10 20:58:40

Great progress in establishing personal credit database: analyst

China's efforts to set up a nationwide personal credit database have seen great progress among privately funded platforms. An analyst noted that the national campaign to establish a credit system will bring growth prospects, but private credit reference providers must conform to business ethics in building their brands.

More than 600 entities' databases have been connected to the personal credit database of Baihang Credit, the first privately funded national personal credit system approved by the People's Bank of China (PBC), the central bank.

The figure was provided by Chen Yulu, deputy governor of the PBC, at a press conference during the two sessions on Sunday.

In January, Baihang launched three credit service products including a report on personal credit, Chen said.

Baihang's data will focus on individuals' loan repayment records, and it will help people build credit ratings as well as provide information to banks, internet finance firms and other related entities or individuals, so as to improve social management efficiency, an analyst said.

Credit systems are a practical move to solve the problem of information asymmetry and help lenders make better decisions, Dong Dengxin, director of the Finance and Securities Institute at Wuhan University, told the Global Times on Sunday.

"The database can help banks and other financial entities get a sufficient grasp of borrowers' repayment ability in advance," Dong said. 

Credit information is increasingly used in other social areas as well. Some mothers even will check the credit records of their daughters' boyfriends before marriage, Chen said during the press conference.

"I'll be at ease if I can check the credit record of a guy who wants to marry my daughter in the future," a white-collar worker surnamed Song in Beijing told the Global Times on Sunday.

Baihang's personal credit data will be made available to commercial banks, internet finance firms and eventually to the utilities and telecommunication sectors, which will bring great growth prospects to the entity.

So far, 125 credit reference entities and 97 credit rating agencies have been founded in China, and 80 percent of their funds have come from the private sector, Chen said.

"Besides a stable profit model, another key point for these private credit entities is abiding by business ethics. Only by combining these practices with proper regulations can they grow as credible and authoritative brands," Dong said.

Newspaper headline: Great progress in establishing personal credit database: analyst

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