Beijing's personal bank loan consumer credit information system
is expected go into effect some time this month, sources from the
Beijing Banking Industry Association revealed.
A spokesman for the association, composed of 21 domestic member
banks and 18 foreign ones, said that establishment of the system is
to deal with the ever-increasing volume of bank loans and to help
banks minimize loan risks.
After the establishment of a credit information collection
system, all member banks will be required to submit their clients'
credit records, and this information will be available to all
members free of charge.
"It will help ensure that banks in the capital city can get
convenient and accurate credit information on their clients to help
them avoid possible bad loans,'' said the spokesman.
"Or, putting it the other way round, citizens with bad credit
records will not be able to go to other banks to get loans, which
will not only reduce risk for the banks but also encourage clients
to honour their commitments to the banks.''
According to the association, the credit information system will
first cover automobile loans, with information collection on
automobile loans going into effect tomorrow.
"This is being done because automobile loans in the city have
been increasing dramatically in recent years and member banks are
moving to cover auto loans first because of the high risk
involved,'' said the spokesman.
Official statistics showed that the total volume of automobile
loans exceeded 20 billion yuan (US$2.4 billion) by the end of the
first half of this year.
Insurance companies have also become wary of the automobile loan
market because of the high risk involved.
"So far, two categories of clients are to be listed in the
system: those who have provided false personal information to banks
or have applied for loans several times in a short period of
time,'' the spokesman said.
In line with the schedule formulated by the Beijing Banking
Industry Association, by the end of next March, research and study
on housing, tourism and individual consumer credit should be
completed.
And some time in the latter half of 2004, the full-fledged
consumer loan system for banks is expected to be officially
launched in the capital city.
However, experts and insiders say that since there is no
specific de facto law on personal credit records, the protection of
personal privacy may become an difficult issue in information
collection, hindering the development of the consumer loan credit
information system.
Chen Jing, a director with the Technology Department of the
People's Bank of China, the nation's central bank, disclosed that a
draft rule for personal credit has been passed on to related
government departments and is waiting for approval.
"It is expected to be issued next year,'' said Chen.
(China Daily October 9, 2003)