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Tom Seest

August 27, 2023

What Is a Social Credit Score?

History


An Overview Of Social Credit Scores

By Tom Seest

What Is a Social Credit Score?

At SocialScoreNews, we help people interested in social credit scoring and scores by collating information and news about the topic.

Social credit scores seem like something out of Black Mirror or Big Brother, sparking alarm among human rights organizations and news outlets.
But the reality is more complex. Contrary to popular belief, there is no single system of scores for every citizen, and those that do exist require opt-in participation from individual users.

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Is a Social Credit Score Like a Credit Score?

China has used big data technologies to create a social credit system that extends beyond financial credit scores. This system seeks to ensure that citizens, businesses, and the government act with honesty and sincerity to build an economy with sustainable economic growth while upholding political stability. Unfortunately, this system has yet to reach its full potential due to being too centralized and intrusive for many citizens; some critics even liken its governance structure to George Orwell’s dystopian governance seen in “1984”, the novel.
China’s system has long been associated with George Orwell’s work and thus with an overarching Big Brother figure like Stalin or Mao Zedong. But in reality, it’s much different. First of all, there is no single algorithm measuring creditworthiness within China; rather there are over three dozen pilot systems that operate differently. Private companies like Ant Financial’s Zhima Credit or Sesame Credit, which uses shopping habits as criteria, also offer unofficial social credit programs.
Although each system differs in how it operates, they all possess some common traits: tracking and scoring behaviors, rewarding positive actions while punishing negative ones, and providing an aggregate profile of both online activities and offline behaviors that combine into an overall assessment for an individual. Critics such as George Soros and Mike Pence contend that this kind of system could be misused by corporations and governments for controlling purposes.
However, this hasn’t stopped millions of people from protesting the system. Recently, however, the government has begun enforcing travel restrictions for citizens with low social credit scores, with penalties including potential bans on certain schools, luxury hotels and even government positions.
As social credit systems expand and mature, government agencies must ensure they remain transparent to citizens. If citizens cannot understand how they are being assessed or punished, their support may dwindle quickly.

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Is a Social Credit Score a Risk Assessment?

Social credit systems use various criteria to evaluate people’s behaviors and provide an overall rating, such as donating to charity or associating with certain people. A higher score could give access to services ranging from flights and apartments; conversely, a low one could limit this access. Therefore, any foreign business expanding into China should seek professional advice regarding managing its local scores before undertaking expansion activities.
Fear and outrage about social credit systems may arise in some, yet it is essential to comprehend their workings before being alarmed by them. They’re not yet nationwide blacklists that prevent travel or attendance at school, nor do they exist the same way as financial credit ratings do.
Rongcheng has introduced a highly controversial social scoring system that rewards and punishes residents according to rules that can often be difficult to follow. These laws may impose severe punishment for activities like posting negative comments online, not paying taxes or missing payments; such systems aim to maintain order among its population by keeping everyone in line.
Financial companies and government regulators plan on using social credit scores in the future to gauge whether someone will pay their bills on time, engage in risky behavior that damages their reputation, commit crimes or violate regulations, or identify individuals likely to commit violations that require more stringent policies for enforcement.
Social credit systems may be relatively novel in China, yet it has already gained broad public approval. Research suggests that those who are wealthier, better educated, and urban residents tend to support it, while older citizens generally hold negative opinions of it. Unfortunately, most respondents know little or nothing about how the scoring methodology works, and thus, more transparency must be provided if this system is to win widespread public support.

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Is a Social Credit Score a Marketing Tool?

Social credit score is a system used by both private companies and governments to rate your behavior and actions, including your behavior and activities to measure trustworthiness. Financial companies and government regulators use this number to decide whether or not to lend money to you; financial firms use their credit scores when considering whether or not to lend money – if your score drops too low, it can make borrowing difficult, but there are ways you can increase it like paying bills on time or opening accounts with financial companies that offer loans or financing solutions;
Although most members of society support social credit scores, two key concerns have emerged regarding transparency and fairness. Too many individuals lack information on how they can increase their scores; few know which factors go into their individual score calculations; furthermore, they feel highly-ranked officials do not adhere to equal standards as lower-ranked citizens.
China has implemented a controversial social scoring system designed to measure individual trustworthiness. First announced in 2014 and set for full roll out by 2020, there are currently over three dozen pilot systems operating throughout China, ranging from Rongcheng’s dystopian style system in Rongcheng Town using Black Mirror-esque measures through Ant Financial’s national rating system run out of Alibaba Payment Firm.
An array of metrics is used to calculate an individual’s social credit score, such as how much money they spend and spend again on unnecessary items, their incidence of lawbreakers reports, and interactions with neighbors and donors – from receiving traffic tickets or not helping elderly neighbors up to +30 points for donating blood or helping an elderly person out in need. While critics praise this system as encouraging sincerity among its users, its proponents believe it could also be used to control the masses more easily.
Government and private companies alike have touted the system as a powerful way to reward good behavior while penalizing bad. Not only will companies gain insight into consumer spending habits, but incentives can be offered based on consumers’ score levels – from discounts on products and faster application processes to travel abroad!

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Is a Social Credit Score a Way to Control People?

China’s social credit system has recently generated much discussion in the Western media. It’s often depicted as an all-powerful surveillance project that restricts personal freedoms through advanced technologies. But instead of acting like an all-encompassing algorithm, it consists of local pilot programs using multiple sources of data to reward good behavior while penalizing any that violate social norms.
Pilot programs built around data such as payment history, police records, and online activity provide companies with tools they use to assign customers their own social credit scores – this allows them to provide benefits like waived rent deposits and tax breaks, while bad behavior could result in blacklisting or reduced benefits. The system also tracks public behavior and enforces sanctions such as fines for violating laws.
Even with all the media attention surrounding social credit in China, it is essential to remember that there is no unified social credit score for all Chinese. The central government has not issued guidelines for the national implementation of social credit systems, yet only a handful of regions have established local systems – many are unofficial and unexpectedly exist within certain cities like Rongcheng (a city with half a million residents).
While it is difficult to predict the future of these systems, it is evident that the central government is taking steps against any rogue pilot projects and rewarding or punishing citizens according to how their perception of them changes over time.
At present, it can be challenging for citizens to evaluate these systems since their methods are opaque. As these systems expand into wider implementation, citizens must trust that they will be treated fairly and their information won’t be misused against them; without transparency, public support could diminish. As more transparent systems advance more rapidly, it will be essential to maintain approval from citizens; otherwise, if citizens become unaware of how assessments of trustworthiness are being determined or experience unfairness, they could lose faith in it altogether.

Be sure to read our other related stories at SocialScoreNews to learn more about social credit scoring and scores.

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