Tencent’s WeChat Pay will start giving its 600 million users a credit rating using an AI-based system to determine people’s “trust” value, according to Asia Times Financial.
In recent years China has almost become a cashless society. According to company data, around 300 million people use Alibaba’s Alipay, and 600 million use Tencent’s WeChat Pay.
The move into credit scoring has been long expected. During 2018, Tencent began a nationwide test of a system only to call it off the next day, claiming more improvements were needed.
In China, the private credit scoring system is depending on credit score studies that are mainly Alipay’s “ant” credit score scores, or the nationwide background verification by the Peoples Bank of China.
Tencent’s great rival, Alibaba, launched its Sesame Credit system in 2015, using online behaviour, including shopping habits and interpersonal relationships, to judge the creditworthiness of millions of consumers and small businesses.
Now Tectent/WeChat finally made the long-expected move.
Carlo Cocuzzo, an economist who focuses on digital finance at the Global Research Department, said: “The coronavirus pandemic could encourage central bank digital currency adoption throughout the world because of rising contactless payments and a bigger role for governments within the economy.”
“Some countries could even ‘flex their muscles’ in the digital payments market once the dust settles. Any significant move from China in this direction would not go unnoticed: China is the world’s largest economy and is at the forefront of experimenting with digital payments and digital platforms,” he added.