China Needs Better Credit Data to Help Consumers

Martin Chorzempa

No PB18-1, Policy Briefs from Peterson Institute for International Economics

Abstract: Formidable barriers stand between the modern financial system and the hundreds of millions of Chinese citizens still using costly informal credit. For many, the financial data that could be used to give them a credit score that would lead to a fair priced loan exist but are not being used. This analysis finds that the most difficult barriers cutting these data off from their potential use for greater financial inclusion are the legal and political restrictions on data sharing and use, economic and competitive concerns from data holders, and the technical difficulty of integrating disparate systems. Policies that encourage coordination between public authorities and private actors in finance and technology can go a long way towards making these data available and driving access to credit in China. This shift would not only help borrowers: It would also encourage the needed economic rebalancing towards consumption, increase competition in the financial sector, raise efficiency through better credit allocation, and contribute to sustainable economic growth and social welfare.

Date: 2018-01
New Economics Papers: this item is included in nep-cna, nep-fle and nep-tra
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://www.piie.com/publications/policy-briefs/ch ... -data-help-consumers (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:iie:pbrief:pb18-1

Access Statistics for this paper

More papers in Policy Briefs from Peterson Institute for International Economics Contact information at EDIRC.
Bibliographic data for series maintained by Peterson Institute webmaster ().