S1E3 - Sorry, Your Human Rating Sucks - China's Social Credit Score System

March 5, 2019 Lydia Shompole

I’m so excited to share another interesting yet creepy tech that’s changing not only the way that we behave, but also our perceptions on what we believe is real.

The idea of credit scores has been around since around 1989 and most of us are familiar with the intention behind this system. Credit scores initially known as a FICO score are the measure of how trustworthy and individual is in terms of spending, saving and their ability to pay back loans or credit lines.

Companies use these scores to predict the potential risk of lending money to an individual or business and these scores are used by just about everyone in the world. Credit bureaus (typically three in the united states) collect data on how we spend money, how we pay back our credit lines and loans and also if any other companies have ever had issues getting their money back from us.

The idea in itself is normal enough, sure we all want to be able to get a new car, or qualify for a home loan, or apply for a credit card for unexpected travel or family emergencies. Lines or credit or loans are a way for us to get those things and pay for large purchases over an established period of time. But they do have a dark side, most notably, the consequences that we have to deal with when we make bad financial decisions or can’t pay back money we borrowed. Which leads to a lower credit score.

It is commonly understood that a bad credit score means we may no longer be able to rent an apartment, by a car or ever own a home. Which are all pretty big things to come to terms with.

But what happens when governments begin to introduce a nation-wide mandatory social credit score system? What impacts will that have on our lifestyle, friendships, relationships and career options.

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You may already be wondering where I’m going with this weeks’ episode. Well let me introduce to you to newest and creepiest technology being implemented in China.

In early 2010 China began testing the beta program of the Social Credit Score system and by 2014 they began allowing companies to tackle the task. The pilot program has been running for 9 years now and China has stated that by the year 2020 all Chinese citizens will be in an official database. The social credit scores of every single citizen will be made publicly available and fully enforceable by 2020.

So what is this social credit score system and why should we be concerned about it?

The social credit score system is made up of a whole bunch of data, much more than what the U.S currently uses for its financial credit score system. At the moment the social credit scores of individuals is basically monitored by either city councils or large private tech platforms that hold and maintain citizens personal data.

There is no one official system in place, instead companies like Ant Financial's Zhima Credit also known as Sesame Credit have essentially created private versions of this government program and the intention is that the government may collect all data assembled by these companies in the future (beginning in 2020 onwards) to officially use in the program.

But at the moment since these companies are not actually part of the governments plan, the data and the companies collecting and creating individuals’ profiles may actually be shut down once the government decides how to enforce the credit program nationwide.

And in the future since the government would be monitoring and controls this program and its data, any individual who is caught behaving against the standards set by the government can be punished by law.

These days, we casually discuss data collection like it isn’t a big deal. We quickly accept terms of service agreements without fully reading the fine print as if it doesn’t matter. But our data says a lot about us, and the Chinese government/ companies world wide know just how much they can influence us once they have this information.

While reading the press release from the Chinese copy right and media website edited by Roger Creemers which was officially released in June of 2014 the intention of the social credit scores program is pretty clear. The release says the following:

“It is necessary to strengthen supervision, management and punishment of trust-breaking enterprises and employees, and progressively establish cross-regional and cross-sectoral credit reward and punishment mechanisms.”

Breaking this down, the overall intention seems pretty logical and almost pleasant. I’m sure many of us have been conned, robbed, or otherwise taken advantage of through a business transaction or a friendship or just by a random stranger out there.

If someone were to offer you a way to know exactly how honest and reputable every person you meet has been and essentially provide a prediction of future behavior, a lot of us would jump at that chance and rejoice in the added peace of mind that comes with knowing who you can trust.

But we must start asking ourselves does a government body imposing this system begin to encroach on our rights as human beings and can this system be used to restrict those rights? And how can individuals protect themselves when their data is used against them to imprison or restrict them from the basics of survival like housing, access to adequate nutrition and fair opportunity?

Now, you may be thinking that having a database that you can access before making decisions on who to trust could be a good thing. And yes I can partially agree with you there, but with the added note that for this system to be beneficial to the way we interact with each other it must meet some basic requirements.

1. For a system like this to work, it should be monitored and controlled by an unbiased board or company. This board must also have regulations that they must follow as well to ensure a fair and honest practices are being followed. Individuals in this board or company must also be held to the same standard that the population is held to.

2. The rules and laws that govern this system must also be agreed upon by all individuals participating in the program. IF we take a look back at our history, we can all find examples of times where society set standards and norms for behavior that clearly went against what was ethical or moral. And for that reason, regulations that are now put in place must be able to evolve and change to fit the population and the times.

3. And finally, individuals must have access to their data and the ability to appeal any information which they believe was incorrectly reported. And for those without the means to appeal their credit scores, the government must provide them with the ability or the resources to do so.

At the very least these 3 basic requirements should be kept in mind while developing this system for use on large populations.

The collection of data on individuals behavior, interests, habits and actions is a hotly debated topic in every single industry at this very moment. Rightfully so, as technology evolves and humans adapt to these changes, the regulations that govern how the data is collected and used need to be improved at every single step.

In the case of the social credit scores program, the data collected spans every aspect of an individuals life. An individual or a business will be given an identification number that links to their individual permanent record. This record will then be accessible on a credit China website. A few key pieces of data that the program intends to collect includes the following:

1. The social credit program collects data on an individual’s finances - This tells China just how much your making, where you are making it, how you spend it, how you save it, what’s important to you, what kind of emergencies you can pay for, how close you are to not being able to pay your rent, your habits, places you visit and spend your money at, vices you may have, your impulsivity when it comes to money etc.

2. social media activities – they look at what you post, when you post, what things you like on social media, how long you look at certain images or posts, what websites you go to, and changes in your belief systems (and if these go against societal standards of behavior your score lowers again)

3. credit history – they look at your ability to pay loans or credit back as well as how reckless or smart you are about the money you earn as well as if your money is made doing things that are not considered appropriate

4. They also look at your health records – your visits to the hospital or mental health providers, what you went in for, what you discussed with your doctor, any tests that were run, any medications you are on and also any illegal behavior that may be the reason you ended up in the hospital to begin with. So things like were you doing drugs, were you too intoxicated, did you get in a fight and come in with a black eye. The list is endless.

5. online purchases – any purchases, either strange or just normal ones, any reviews you leave or products you look at, as well what other products may be available on these websites and whether they are considered “appropriate”

6. tax payments – how honest are you about the money you earn and are you paying the government the amount you should be?

7. legal matters – have you been to jail or been arrested, all the details about your criminal history that either implicates you or is used to defend you. Any discussions had about you by law enforcement or any one speaking about your behavior in a negative way. IF there are any complaints against you from other citizens or reports made against you as well everyone that you have either associated with in the past or are currently associating with. They also collect the likelihood of an individual’s committing crimes or associating with those that commit crimes or behave in ways that conflict with the government’s standard for society.

8. Last of all the social credit system uses all the video and photo surveillance collected country wide. And you can be sure there is a lot of data. In fact, China has over 200 Million surveillance cameras in operation 24/7 across the entire country. Not only that, these cameras are linked up to a system that has full facial recognition software and is monitored round the clock.

All of this data has only one purpose in mind, to control individuals simply by incentivizing good behavior and punishing bad or insincere dishonest behavior. The system creates a space where behaving in any way other than what is socially acceptable, is immediately seen, recorded and punished by a lower score.

The lower your score goes, the less other individuals, companies, and the government will trust you in your day to day life. As a result, individuals may refuse to date you, companies may refuse to hire you, fines may be sent to your house and you may even get arrested and jailed.

Scary right? And that’s just the beginning. Any data that shows that an individual doesn’t follow any of the established societal norms or standards or goes against any contractual agreements is immediately reported to the government and will be a permanent part of the individuals record.

Initially the social credit scores program used paper records to keep track of an individuals behavior. That method was considered to be too slow and the government began looking into technology that could speed up the process making the data more accurate and easily accessible. This system is still being created and in the future the records will be available online through a credit reporting website. In the mean time, the Chinese government is watching how a few large companies are collecting, analyzing and reporting individuals social credit scores.

The social credit score program has a few of the same benefits that the financial credit score implemented by the U.S and other countries has. Like better money management, better lending practices, better opportunities because loans and credit are available, and even human beings being more honest when it comes to how they borrow and pay back companies that give them money.

But, like I mentioned earlier, there is a flip side to any technology out there, and the social credit scores program has just as many cons if not more.

For individuals with high social credit, the world opens up and opportunities are endless. They can rent properties, get better jobs, earn more money, have better choices in a significant other and providing for their families etc.

There is even a large dating company, The article by BBC will be linked In the show notes, that provides users looking for love with the option of posting their social credit scores on their profile. For those with good credit, their credit becomes an added perk to their overall package.

But for those with low social credit, the doors begin to slam shut one after the other.

If you decide to do a bit more research on this technology, you’ll come across countless articles from large publications explaining just how twisted the punishments and consequences of bad behavior of this program can be.

Some of the punishments that countless articles have discussed include the following:

1. You can be blacklisted and labeled as a Dishonest person

2. You can be restricted from buying property, signing a lease, or even applying and receiving loans or lines of credit

3. You can be restricted from buying train tickets, or traveling outside or inside the country – its been reported that over 9 million people with low scores have been blocked from purchasing plane tickets for domestic flights

4. You can be fined and until your fine is paid you will remain on that list with that label

5. Banning you and your kids from the best schools in the country

6. Or even slowing down your internet speeds

All of these punishments have serious impacts on your life. You may lose your home, lose your job, be unable to travel to see family In emergencies etc.

And at the end of the day there is no official social credit program yet, so there is nobody you can contact, you won’t receive a notice in the mail telling you that you’ve been labeled. Your rights may just be restricted indefinitely if need be.

And because the algorithm is a mystery to everyone other than those that created it of course.

Your life and the opportunities available to you, is no longer entirely in your control.

How do we know that the system is unbiased and fair? – well we just have to believe that it is.

How do individuals know which behaviors are hurting their scores? – They don’t. They can only look at the things that are considered good and begin doing more of those and less of the ones that most people believe are bad.

Things like jaywalking, not paying fines, walking a dog without a leash, playing video games for hours a day, these are all things that have been mentioned as credit lowering behaviors.

And things like donating to charity, driving the speed limit, or even reporting others who are dishonest or insincere are considered credit increasing behaviors.

But Does the system aim to account for extraordinary circumstances? Hopefully these companies will provide this option and hopefully the government will include these options in the final version of the program. But no one is completely sure what will happen yet.

And while we don’t really know every single thing that is considered while calculating the scores, the press release I mentioned earlier goes through the reasons and goals of creating and implementing the program. It does not dive into the companies connected to the system nor does it provide a full list on every single individual that has a role in creating the system.

There are a handful of companies, like I said earlier, that the government is watching to see which practices are the best for collecting, analyzing and calculating social scores, but to the average citizen the best means of getting some answers may be to dig into these companies and begin asking for reports on how the system works and how they can protect themselves in cases where the data on their file is incorrect.

But even this may be futile, since these large companies are at the mercy of the government in the long run and may be shut down if they were to reveal information to individuals, companies or the media.

As always, hacking of this data and its use against individuals is something we must keep in mind as we move forward. There are plenty of downfalls to having so much of our data being controlled by large corporations/ governments.

In cases where and individuals data (basically life) is incorrectly adjusted or manipulated the best way to proceed is to assure that you keep excellent records of your behavior, your interactions with others and your choices.

IT can be difficult to prove that you didn’t do something that was reported and since this is a new frontier in itself, being aware of the changes in technology and what that means for you is the first step to having some control over your life.

Additionally, the impact on mental health from this system can be significant. We may start seeing an increase in mental health issues in China and world wide once this tech is widely used because of the change in how we interact with those with lower social scores.

The social credit scores program may be creating and enforcing a new caste like system. And we have seen how caste systems or tribe like mentalities affect human behavior. The separation between those with higher scores and essentially better lives may create a rift where an individuals’ score determines the way they are treated resulting in a whole other set of issues to deal with.

We have also seen it happen with the financial credit scores program. There have been cases where individuals have been left feeling so hopeless, useless and overwhelmed with how much it will take to change their financial situations that they do spiral out of control.

This should be considered when implementing such a system. While its easy to believe that raising the standards for all human kind and publicly shaming negative behavior can only have a positive impact on every society as a whole.

It would be naive to assume that improvement is the only thing that can occur.