CAt the recent 9th World Consumer Credit Reporting conference the Tsinghua University, School of Economics and Management presented a study of the impact of the Chinese Credit Reference Center (Credit Bureau) on the Chinese economy.   The People’s Bank of China established the Credit Reference Center in 1992 and in the following years it has become an important part of the Chinese financial infrastructure.

Key takeaways from the presentation are:

  • The Credit Reference Center performs a critical function for the Chinese financial system
  • The Credit Reference Center facilitated access to finance for individuals and businesses leading to economic growth
    • Increase in GDP by 4.28% through increases in consumption and investments
    • Increase in employment including SMEs
  • The Credit Reference Center contributed to a significant reduction in commercial loan defaults

The presentation closed with a summary of current challenges ranging from China’s incomplete credit market, the Credit Reference Center being a monopoly, the relative slow development of private credit bureaus and the need to strengthen data protections regulations.

To view the presentation click on this link: China 04_-_Impact_of_CRA_s_on_the_economy

Source:  Tsinghua University, School of Economics and Management