Research On The Choice Of China's Personal Credit Mode

After over 100 years' growth in developed economies such as Europe and America,personal credit has become quite mature and occupies an irreplaceable position in the credit market as well as other financial fields.In contrast,China's personal credit construction is still in its infancy and requires constant efforts for further improvement.So far the construction of China's personal credit system has been led by the People's Bank of China(hereinafter referred to as “PBC”),and the system is a national and pubic one known as “PBC Personal Credit System”.Over the years,the credit report from the system has always played an important role in financial institutions' decision on credit granting.However,people with a complete credit record only account for 23.7% of the country's total population,according to the system.Not only is the figure far from the number set by the “Pratt & Whitney” target,but also there still remains a huge gap between ours and that of developed regions'.On the other hand,the Internet industry in China has been growing to maturity with better regulation.Meanwhile,our personal credit system has also made remarkable breakthroughs driven by big data based on the Internet.In Janurary,2015,the PBC published an announcement,which demanded that eight private institutions,most of which were Internet companies and which included Sesame Credit,Tencent credit make full preparation for personal credit business,Allowing private capital into the business has been interpreted as a sign of marketization of personal credit,and it is significant to the business' s development.The development of credit business in private institutions,especially the personal credit business,makes it possible for the credit evaluation system with enterprises to evolve into market-oriented products and business forms.This paper attempts to explore the personal credit model that might be suitable for China,and it will examine the characteristics and problems of present personal credit agencies.It is hoped that this paper would be helpful for the development of personal credit system in China.Firstly,this paper introduces the ground theories for different options of personal credit models and analyzes the situation and problems of the current one,and it is pointed out that PBC plays a leading role in the development of personal credit system.Besides,there exist some problems in the system,such as lack of legal and institutional regulation,narrow range of applications,serious data blockade and so on.Secondly,some experience and lessons that might be useful for China have been drawn from the comparison of different models of the United States,Japan and other countries.Moreover,a comparative research has been conducted between the PBC Credit Center and private credit agencies with Sesame Credit as the representative in terms of personal credit information data source,credit product and its application.Finally,it is concluded that the coexistence of private credit model and public credit model makes up the current map of the business in China.It is also stressed that the PBC is dominating in the stage with market-oriented personal credit agencies as supplement.At the same time,the personal credit business will be fully market-oriented as the credit market grows to maturity.The PBC Personal Credit Center will only function in personal credit information database management and operation,that is,the model of personal credit will be completely privatized.Last but not least,some suggestions have been made for policy-makers regarding the conclusion.