In 2014, the Chinese government announced the creation of a Social Credit System. Expected to be fully operational and mandatory by 2020, the aim is to have a social credit score for every Chinese citizen. This score will be based on people’s behaviors and will determine their level of “trustworthiness”. In order to monitor their behavior, the approximately 200 million CCTV cameras across China will be connected to facial recognition systems and cross-checked with medical, legal, and financial records, which will then be interpreted by artificial intelligence networks. China’s ruling Communist Party claims that the system will “allow the trustworthy to roam freely under heaven, while making it hard for the discredited to take a single step.” Similarly, President Xi Jinping described the system with the phrase “once untrustworthy, always restricted”.
There are two main reasons behind the implementation of this system. The first is based on the fact that China does not have a traditional credit score system, which determines a person’s creditworthiness based on their financial history. This has led to a lack of trust in the Chinese economy, and according to the Chinese Ministry of Commerce, the lack of credit information has led to an annual economic loss of more than 600 billion Yuan. The second reason is the more worrying one; as a system designed by the government to reward desirable behaviour and punish undesirable actions leads to the obvious incentivisation of conforming to the Communist Party’s ideals. This will help to quell any unrest and bolster the regime’s power, and will likely be used to suppress dissent.
The system of rewards and punishments is point-based, with desirable behavior leading to score increases and negative behaviors resulting in point deductions. The amount of points an action will gain or cost a citizen depends on the specific action, but for people who have already accrued certain scores there are additional rewards or punishments. For citizens with high scores, it will be possible to receive heating discounts in the winter, to rent bikes and hotel rooms without deposits, and to get advantageous terms on loans. Also, China’s largest matchmaking site, Baihe, has agreed to promote clients with good scores, boosting their profiles on the website.
For people with bad credit scores, however, life can be much more difficult. They can be temporarily or permanently banned from travelling on planes or trains, they can lose access to the best schools for their children, and they can miss out on job promotions. Furthermore, your score is not just based on your own actions, the scores of your friends, families, and partners can affect your score as well.
There are a multitude of issues with such a system, one of which is clarity. If the criteria for the scoring system are not clear, it will become easy to conceal bias in the scoring process. For instance, government officials could unjustly boost their own scores as well as the scores of their families and even donors. Additionally, the scoring systems do not account for context. For example, a person missing a bill out of negligence would result in the same loss of points as a person missing a bill due to a medical emergency.
Other potential issues include the effects of hackers, if someone gains illegal entry into the system, as well as the potential for a black market. Such a market would allow the rich to improve their scores unfairly and reap the benefits of having high social credit scores, while those who cannot afford to do so, who would likely be in more need of those benefits, would be unable to access them. This could create a two-tier class system, which would be incredibly difficult to escape.
Despite these concerns, approximately 80% of surveyed Chinese citizens have a positive view of the system, according to a study conducted at the Institute for Chinese Studies at Freie Universität Berlin. In a country with rampant fraud, many see the credit score system as a reliable source of information, and privacy seemed to be less of a concern. Unfortunately, a lack of concern does not mean that there is nothing to be concerned about, and this new system could be a harbinger for a new era of digital dictatorships.
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Image courtesy of Ryoji Iwata at Unsplash