May 24, 2018 / 12:31 AM / 6 months ago

China's first private credit-scoring firm starts operations: Xinhua

SHANGHAI (Reuters) - China’s first private credit-scoring company started operations on Wednesday in the southern city of Shenzhen, and will be able to collect and store personal credit information as well as create credit reports and ratings, the Xinhua news agency said.

Baihang Credit Scoring was approved by China’s central bank in January and has a registered capital of 1 billion yuan ($156.56 million). Its shareholders include the National Internet Finance Association of China, Tencent (0700.HK) and Sesame Credit, backed by Alibaba (BABA.N).

“Private credit-scoring companies can supplement the state-run database in providing inclusive financial services,” Xinhua quoted Dong Ximiao, a senior researcher at the Renmin University of China, as saying.

Baihang was not immediately reachable for comment.

China’s existing, centralized credit scoring system, the Credit Reference Center, only covers around 300 million people out of around 800 million potential borrowers. That creates a blind spot of some half a billion borrowers beyond Beijing’s credit network. By contrast, almost all adults in the United States have a credit score.

This in turn has sparked a push by China’s big technology companies to develop credit-scoring platforms.

Reporting by Brenda Goh; Editing by Muralikumar Anantharaman

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