China’s New Lenders Collect Invasive Data and Offer Billions. Beijing Is Worried.

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China’s New Lenders Collect Invasive Data and Offer Billions. Beijing Is Worried.
In a country that lacks reliable ways to tell who might be a good borrower, these lenders use artificial intelligence
and oddly personal data — like tracking how fast prospective borrowers type on their phones — to determine who will pay them back.
In November, the People’s Bank of China, the country’s central bank, stopped companies and people from starting new online cash lending platforms.
“But they don’t really know how to change that because the data is already being used.” Mr. Bai of the China Association of Microfinance added
that “some cash loan companies use all kinds of soft violence to press customers to pay their loans back.” Please verify you’re not a robot by clicking the box.
Two years ago the central bank asked China’s most successful internet companies — including affiliates of the sophisticated online giants Tencent Holdings
and the Alibaba Group — to create their own credit ratings systems.
Its app — Yongqianbao, or “use wallet” in Chinese — helps it build a credit rating system based on 1,200 data points related to user behavior.
Even borrowers like Mr. Bai who don’t pay back — what Mr. Jiao calls a “controlled
delinquency” — help the company by providing data, the company says.

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