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Business Analytics and China’s Social Credit System

Paper Type: Free Essay Subject: International Studies
Wordcount: 1278 words Published: 23rd Sep 2019

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Business Analytics and China’s Social Credit System

Business Analytics is one of the fastest growing markets in the world; businesses are constantly expanding their digital usage and are capable of accurately measuring aspects of operations in real-time. Collecting large amounts of data gives thousands of companies the ability to gather customer demographics and preferences used to make imperative business decisions. This practice is also utilized by China, who created a “Social Credit System” that will monitor the behavior of their citizens and rank the population based on their “social credit.” The system is intended to enforce government compliance, awarding citizens who follow government policies with high social credit scores and personal benefits, while those who disobey government regulations receive lower credit scores and endure a restricted lifestyle with few freedoms. By providing the Chinese with a score, all credit behavior is recorded and evaluated by this specific number.                                                                                                                               Chinese citizens’ social credit scores are determined by numerous factors, including criminal and medical records, academic achievements, security assessments, shopping habits, and even relationships held with other citizens. In addition, the credit system also follows similar aspects of the American credit system, as financial responsibility can result in fluctuating scores. Citizens who abide by governmental procedures receive more personal freedoms and benefits such as the ability to rent cars or hotels without a down payment. Furthermore, children of parents with high social credit scores benefit as well, creating a greater opportunity for them to attend the best schools and hold high income jobs. Conversely, over 10 million citizens who possess low credit scores live with countless restrictions and are blacklisted as dishonest individuals. With no means for challenging their social score, these citizens are confined to their homes and are legally banned from travelling on planes and high-speed trains in the country. Other individuals are removed from the social credit system altogether due to their ethnicity, living in extreme poverty or concentration camps. They are declared to be trustworthy, average, or untrustworthy, facing extreme restrictions to travel, religious practices, and career opportunities. Thus, citizens’ actions and social tendencies, whether acceptable or unacceptable, can change their individual scores in real time.                                                                                                                 Businesses also see their social credit scores fluctuate based on environmental compliance, worker conditions, taxation, value to the Chinese industrial policy, and national investment procedures. Companies with low social credit scores can be penalized through the implementation of higher interest rates, higher taxes, denial of investment proposals, and expansion restrictions. Furthermore, executives and managers can be denied the right to purchase plane or train tickets. Thus, businesses are indirectly regulated as companies strive to maintain acceptable social credit scores.                                                                                                                               There are numerous pros and cons to this social practice, as both supporters and opposers share valid points regarding the effectiveness and purpose of the Social Credit System. Citizens with high social credit scores believe the Chinese government previously had vast amounts of personal information and the implementation of the social system made the data collection process more unified. They agree constant surveillance by cameras in every public location makes the nation safer and this system is imperative to the success and prosperousness of China. Therefore, the social system incentivizes good behavior, encouraging Chinese citizens to comply with the government to enjoy a luxurious lifestyle with exclusive benefits. It also displays a sense of convenience, allowing those with high social credit scores to easily book hotel rooms and car rentals without down payments. The system leads to more honest and law-abiding behavior within the Chinese society.                                                                                                                               The Chinese population’s differing opinions show that not all citizens concur on the Social Credit System. Opponents of the credit system often find themselves with lower social credit scores, struggling to live within their minimal freedoms. They consider their fellow citizens to be blinded by the social system, regarding it to be a form of Chinese propaganda hiding government corruption. The Social Credit System doesn’t leave room for people to make mistakes, forcing citizens to constantly live on edge with the decisions they make. Furthermore, it gives excessive power to the Chinese government, as these officials determine acceptable morals and ethics within the nation. Social credit scores influence the population’s personal interactions, as credit scores are affected by who individuals communicate with, intruding on citizens’ personal privacy.                                                                                                                                                          Regardless of personal views on the Social Credit System, China claims to fully implement this practice by next year. For personal opinion, a credit system can be implemented to collect data on certain aspects of the population’s life; practices similar to the American credit system such as tracking an individual’s financial patterns, gives others the ability to determine the budgetary reliability and responsibility of an individual. However, China’s Social Credit System expands this practice to almost every aspect of citizens’ lives. While there are numerous benefits to the program, including the reduction of crime and fraud, this system assesses people on their social behavior and trustworthiness, restricting the Chinese from living independently. It creates a standard that all citizens must follow, leaving little room for people to recover from past mistakes. The Social Credit System has invaded the privacy of the Chinese people, drastically changing their ways of life and restricting basic freedoms.

Works Cited

  • Australia, ABC News. “Exposing China’s Digital Dystopian Dictatorship | Foreign Correspondent.” YouTube, YouTube, 18 Sept. 2018, www.youtube.com/watch?v=eViswN602_k&feature=youtu.be.
  • Kobie, Nicole. “The Complicated Truth about China’s Social Credit System.” WIRED, WIRED UK, 24 Jan. 2019, www.wired.co.uk/article/china-social-credit-system-explained.
  • Ma, Alexandra. “China Has Started Ranking Citizens with a Creepy ‘Social Credit’ System – Here’s What You Can Do Wrong, and the Embarrassing, Demeaning Ways They Can Punish You.” Business Insider, Business Insider, 29 Oct. 2018, www.businessinsider.com/china-social-credit-system-punishments-and-rewards-explained-2018-4.
  • “The Business Implications of China’s Social Credit System.” INS Consulting, 28 Dec. 2018, ins-globalconsulting.com/the-business-implications-of-chinas-social-credit-system/.


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