Last week Experian stated it will “keep its business operations in the Chinese mainland market” and “will continue providing credit reference and strategic analysis services to customers” after the government vowed to promote healthy development of the country’s massive but tightly held personal credit scoring sector
“As a global company, Experian will use its unique advantages to firmly grasp the major opportunities” brought by the government’s decision, the company said. The State Council, China’s cabinet, said Nov. 25 that it would take measures to elevate the industry’s quality and expand market access.
In its statement Experian said it held discussions with the central bank and local financial regulators in Beijing, winning support for its future business operations on the mainland. The company said it is exploring potential partnerships for business development. Experian may seek to set up a joint venture with partners to apply for a personal credit scoring business license in China, analysts said.
Experian’s planned departure reflected Chinese regulators’ cautious attitude toward foreign players in the personal credit information market, analysts said. In a disorderly competition with excessive collection and abuse of personal information by some local big data companies, foreign players focusing on compliance were at a disadvantage, they said.
Experian, with its Asia and Pacific business contributing about 8% of group profit, has been suffering huge losses and a shrinking market share in China, several industry participants said.
Background: Recently Caixin global reported that Experian had decided to exit China. Caixin apparently quoted an Experian source who stated the company decided to spin off its stake in Chinese subsidiaries and leave the Chinese mainland market while maintaining its business in Hong Kong and Taiwan following considerable portfolio streamlining over the past two years. Experian’s mainland operations were expected to fully shut down by April 2021.
Entering China in 2005, Experian established operations in Greater China covering four major areas—credit services, decision making and analytics, anti-fraud and identity certification, and data quality. In 2015, Experian partnered with e-commerce giant JD.com’s fintech unit in developing an online anti-fraud system. In 2018, Experian Information Technology (Beijing) Co. Ltd. was approved by the central bank to provide corporate credit services. It became the only wholly British-owned enterprise in China to obtain a license for corporate credit services.