China is preparing to establish a national credit rating system for
businesses and individuals, according to the country's central
bank.
Under the system, an individual's negative financial past with
banking services will be registered as a lifetime record, which
will affect their later deals with banks, said Dai Xianglong,
governor of the .
Dai said the central bank built a pilot regional system in Shanghai
in East China last year.
The State Council recently ordered the central bank to spread the
regional system to build a national network, said Dai.
The system will enable banks to lower the loan risk by taking into
account customers' credit entries before making any final deals.
Meanwhile, customers will tend to safeguard their reputation when
considering the long-term influences of "stained" entries.
Such a credit rating system, according to some domestic experts,
are closely related to an individual's reputation at other relevant
institutions, including customs and taxation and foreign
exchanges.
Therefore, if businesses maliciously overdraw funds from their
accounts, they will lose the credit not only among banks but around
the whole financial society, said experts.
Those businesses listed on the "blacklist" by banks will meet
obstacles from other governmental departments and social
institutions. Such a "blacklist," according to sources with the
central bank, will be open for inquiry at official websites.
According to the central bank, Shanghai citizens have avoided the
pedantic procedures of finding guarantors and offering the
individual credit records certificated by employers when they apply
for credit cards at local banks, now that the city has established
the credit rating system.
