Chinese experts and credit
management firms are calling for concerted efforts among various
government agencies while building the country's badly needed
social credit system.
They have expressed worries over rivalry within the government and
suspicions that the central bank is attempting to monopolize credit
data and services, which they warn would only hamper China's effort
to restore confidence in commercial credit.
A handful of government agencies, including the National
Development and Reform Commission and the Ministry of Commerce, are
reportedly drafting their own social credit system plans in a bid,
insiders say, to grasp leadership in the country's massive campaign
to build a social credit system that ranges from database
compilation and business credit management to fostering a
credit-valuing culture and related legislation.
The newly established Ministry of Commerce appears to be leading
the charge. Insiders say the National Leadership Team on Regulating
the Market Economic System -- the decision-making body authorized
by the State Council to oversee the construction of the social
credit system -- is based at the ministry.
"No matter who the regulators are, we will toe the line," said a
senior manager at a major credit management firm. "We just hope
it's decided as early as possible."
Much dissatisfaction is focused on the central
(PBOC), which is reportedly considering setting up a credit
management bureau within its structure and, more to the frustration
of credit management firms, has drafted a credit management
regulation they say is likely to lead to a monopoly.
Insiders say the regulation, which was completed last year,
requires credit management companies to have a minimum of 100
million yuan (US$12 million) in registered capital, a threshold
none of China's some 500 credit management firms, most of them
privately-owned, can presently meet.
"It's unfair," said a manager at a private credit management firm.
"We've been in the business for 10 years but we don't see why we
need that much registered capital."
Some media reports said the PBOC was putting together a credit
management firm with investment from the four largest state-owned
commercial banks, which would presumably have no problem meeting
the capital requirement.
And the new firm will likely be given enviable access to what is
said to be China's largest credit information database, covering
more than 300 cities, which the central bank has built up over the
years.
A PBOC official declined to comment, but reiterated earlier
statements that it is building an "enterprise and individual credit
management system."
Analysts say a social credit system is badly needed in China where
debt defaults are commonplace and many companies have a
"give-me-a-good-rating-and-tell-me-how-much-you-want" attitude
towards credit rating firms.
And legislation is currently the most urgent task, as China still
has no law specifically governing credit management issues.
It is crucial to the development of consumer credit and account
sales,which make a growing contribution to economic growth, said Pu
Xiaolei, deputy director of the Credit Management Department under
the Chinese Academy of International Trade and Economic Cooperation
-- the Ministry of Commerce's think tank.
(China Daily August 4, 2003)