Tencent to Create Consumer Credit Rating Service by Using Social Media
Chinese Internet Giant Tencent Holdings will be launching a consumer credit rating service that is based on an individual online social network. Tencent said that it will be rolling out its consumer credit information service that is aimed to assist financial organizations to improve on their risk management abilities and enables them to give people to get easier loans and increase credit awareness in young people.
Tencent owns a popular instant messaging mobile apps WeChat and QQ believes that by analyzing the quality of a person’s social network and combined with their online behavior on whether they pay their bills on time or not, Tencent can still provide useful information that helps financial institutions to get to know their debtors better. General manager of Tencent Credit Bureau Co. Daniel Wu stated that Tencent’s vast social networking data is capable to help 500 million people that don’t have nay experience in borrowing money to build their credit information.
The traditional way was to allow banks to check an individual’s credit record such as credit cards before they are allowed to loan, but 20 percent of the population has credit cards meaning the 80 percent can’t get any kind of endorsement if they need to take out a loan. 800 million people in China are demanding different kinds of financial services, but the current credit system only covers 300 million people and Tencent can help meet the demand of the remaining 500 million people after analyzing the amount of data that is generated from the different footprints they leave online.
Tencent’s business is based on social networks and it already has accumulated a lot of data that can provide all kind of tools that can help people connect with each other. The credit rating system can help Tencent level the massive social network data get it commercialized and boost income.