Guangdong Bars Range of Nonfinancial Data From Social Credit Ratings

What’s new: China’s southern Guangdong province outlined a new social credit regulation Tuesday restricting the data that merchants can collect on consumers and the sanctions that can be imposed on those with poor credit.

Under new rules going into effect next month, merchants and market credit information collectors are prohibited from collecting information on an individual’s religion, blood type, diseases, medical history and biometrics.

For people and entities with low credit ratings, the regulation includes a list of permitted restrictions on consumption and bars businesses from other measures. The new rules reflect a backlash against situations in which someone with poor credit may be denied access to air tickets and luxury hotels and even job opportunities and certain schools.

Guangdong province is developing a list of allowed incentives for trustworthy individuals and entities and a list of permitted sanctions for the untrustworthy, said Huang Huadong, chief economist of the Guangdong provincial development and reform commission, at a press conference. After a national list is released, the province will update its own list, he said.

The background: Local governments in China are gearing up to roll out scoring mechanisms to evaluate residents’ social credit under a Beijing initiative to set up social credit rating systems.

Some people have found that their social credit can be hurt by a wide range of behaviors, such as skipping train fares, smoking in smoke-free public places and running red lights.

Such practices have raised concerns about fairness as critics argue that local authorities have extended the concept of social credit ratings too broadly beyond people’s financial credibility by wrapping in too much nonfinancial data.

Quick Takes are condensed versions of China-related stories for fast news you can use. To read the full story in Chinese, click here.

Contact reporter Denise Jia (huijuanjia@caixin.com) and editor Bob Simison (bobsimison@caixin.com)

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