China to step up work on national social credit system

The central government will take more steps to improve data quality and speed up the legislation process as part of its efforts to create a nationwide social credit system, officials said.

"Basic infrastructural construction of the social credit system has been done at the central and local levels. More efforts will be put on improving data quality and enhancing cooperation with different regulators and on legislation, the last of which may take several years or longer to accomplish," said an official with the National Development and Reform Commission who is in charge of drafting the guidelines.

Unveiled in 2014, the framework for a national social credit system is already in place, and the government aims to get the remaining work done by 2020.

Under the system, financial behavior such as failing to pay a credit card bill or frivolous spending and bad behavior such as boarding a train without a ticket, can result in serious consequences.

Penalties include curbs on taking flights, trains, employment and educational opportunities, but it also seeks to reward people with high scores. For instance, people with a good credit record are able to get discounts on utility bills and faster application processes for travel abroad, depending on rules established by various local authorities.

"We encourage local governments to build methodologies of their own, and have no intention to unify them as national standards. Local governments understand what fit them the most," said the official.

Looking ahead, relevant government bodies will put more efforts to sign memorandums with other departments, speed up the legislative process and improve data quality, at a time when data collection is still conducted by people manually in some distant places, the official said.

Liao Yongan, vice-president of Xiangtan University, said the government should improve protection of credit information of individuals. Liao said unlike personal information in general, credit information has unique legal attributes that need to be specifically addressed in social credit legislation.

Echoing his remarks, Han Jiaping, head of the Institute of Credit and E-Commerce at the Ministry of Commerce, said China needs to promote legislation for the public and market entities credit systems.

The NDRC and the People's Bank of China are establishing their own credit systems, with some overlaps and responsibilities in regulation yet to be clarified. Algorithmic transparency should be included into future legislation of social credit system. Rules such as how governments conduct analysis to reach a score or ranking should be specified, Han said.