The Beijing municipal government and the People's Bank of China
are going to jointly build from 2008 an information network on
individual business and personal credit records.
The information collection and construction of the credit record
system in Beijing will be completed by 2010, the Beijing
News reported on Sunday, and will include details of criminal
records from police.
The Beijing municipal government will help the central bank to
build the database, which will be shared among banks, municipal
governmental branches in charge of public security, social
security, taxation, and governmental employees' housing funds
administration, the newspaper said.
Meanwhile, people could get their own credit information or
endorse others with written documents to check the history for
them.
Neither the government nor the bank disclosed the cost for
building such a virtual reality system.
Only selected governmental authorities and financial
institutions could get access to the individual credit database, an
official with the Beijing Municipal Development and Reform
Commission said, adding that credit history-related privacy will be
strictly protected.
The government also said it is considering establishing some
policy incentives, including preferable loan terms or taxation
discounts, for businesses or people with good credit history, the
newspaper reported.
Banks are among the primary beneficiaries of the establishment
of a credit record network. China has roughly 31 million credit
card holders, but issuers of the moment cannot get card holders'
credit history via a universal network. Malicious evasion from
loans leads to huge costs for banks every year.
In China, people can easily obtain credit cards by just
submitting basic information such as names, jobs, salaries and
contacts. Banks are unable to find out the credit history of
first-time customers.
Liu Feng, a risks management specialist of the Agricultural Bank
of China, said financial institutions urgently need credit records
of individuals.
"It would not be difficult to digitize and share the financial
information of customers among banks," Liu said, "but it'll be more
helpful to banks for including other information, such as criminal
record and taxation record, into the database."
"The combined information would sufficient describe fuller
images of our customers," Liu said.
The scheduled credit record network, according to the plan of
the municipal government, will include traffic violations of
drivers, particular severe offense such as hit-and-run, and frauds
of business people.
Inclusion of information other than financial status into the
credit record database arouses debate.
A Chongqing lawyer said that negative personal information such
as criminal records should not be included into people's credit
records, which should largely be used for loans. The lawyer said
such privacy should be strictly protected from being accessed by
anyone other than law enforcement officials.
Mao Shoulong, a public administration professor at the Renmin
University agreed that a combination of financial status with other
personal backgrounds, like criminal records, would be helpful. He,
however, said, "Alleged violations should not be recorded on
people's credit history before their appeals to higher law
enforcement bodies are completed."
(Xinhua News Agency December 10, 2007)
