According to a report in the Financial Times, the effort has become a ‘tug of war’ between the Internet giants and the central bank, which is also looking to release a scoring system.
China’s system does not have the same scoring that other developed financial markets so, and therefore both Alibaba and Tencent have been racing to provide a strong option for consumers.
The schemes have raised questions around data privacy and have even led to some drawing parallels with sci-fi series Black Mirror.
According to the FT, the People’s Bank of China had put pressure on the companies and led to Tencent pulling its beta test. PBoC said regulators should be able to set standards first and warned that the scores could be used as marketing tools for Tencent and Alibaba to sell products on top of.
Eight companies were selected by PBoC in 2015 to look at credit scoring options, including using social data. None of the companies, including Tencent and Alibaba-owned Sesame Credit, have secured a license, while the government-backed Baihang Credit Scoring, also known as “Xinlian”, has failed to launch as yet.