Blog Post #9: EOTO presentation #2

“Social credit score” is defined as a “national credit rating and blacklist being developed by the government of the People’s Republic of China. Essentially, this means that the system monitors a lot more than our financial savviness. It involves governmental and financial institutions that watch our everyday habits and rank our behavior. It monitors both online and through CCTV monitoring which has been named the “social credit score.” CCTV monitoring is referred to as Closed-circuit television. In short, it is video surveillance, which is the use of video cameras to transmit a signal to a specific place, on a limited set of monitors. However, with this comes along a few good and bad implications. A higher credit score signals that a borrower is at lower risk and more likely to make on-time payments, whereas having a lower credit score means that it is harder to borrow, trouble getting loans, whether it's a car loan, mortgage, or credit card account.

A few of the benefits of having a social credit score include that it helps eliminate problems such as food safety issues, intellectual property theft, violation of labor law, financial infidelity, and counterfeit goods. Rewards for positive social credit include less frequent inspections and audits for businesses, fast-tracked approvals for government services, discounts on things such as energy bills, better interest rates at banks, tax breaks, and simple things like being able to rent bikes and hotels without payment of a deposit. The three most important advantages of having a good credit score include that you have higher credit limits, potentially lower interest rates, and more purchasing and negotiation power.


Some of the disadvantages of having a social credit score is that having video surveillance and social media monitoring is invasive, individuals and companies have significantly less privacy, the system is open to mis-scoring and algorithmic mistakes, and there is a lack of knowledge regarding scoring which can promote corruption. Those who have low credit scores ultimately risk getting treated as second-class citizens. There are many consequences to having a low credit score. Some of the most common causes that lead to low credit scores include late payment of bills, bankruptcy filing, charge-offs, and defaulting on loans. Some other examples include things such as traffic offenses such as drunk driving or jaywalking, “illegally” protesting against the authorities, and not visiting aging parents regularly.

Overall, social credit scores can affect our society as a whole for many reasons. In a sense, some people argue that social credit systems encase humans because people can get easily “blacklisted” which has severe real-life consequences. When someone is “blacklisted” it means that they are out on a list, and there is no trial at court. Essentially, to get off of the list people and companies can appeal against being blacklisted or against receiving bad credit. It also impacts our entire world because we are always being stalked and tracked through every move we make, every purchase we make, and every place we visit. For example, the bank can calculate our financial credibility, interest rates, and companies such as AirBnB, and Uber can disable your account. For instance, if a homeowner or a driver reported you for ‘bad behavior’, without giving you any choice to appeal. Overall, it impacts our society because it defines people's lives by limiting their life choices and freedom, it leads to inequality, and influences people’s behavior and the way they live.

Not only does the social credit score affect our world, but specifically it has an impact on on the different segments such as the rich/poor, old/.young, male/female, gay/straight, and majority/minorty. Many people argue that it creates discrimination and that it is biased towards certain groups of people. Credit scores are based on past performances. According to Cnbc, “The further we go back in history, the deeper the structural racism in the United States was.” Cnbc posted a survey of 5,000 U.S adults and found that “more than half of Black Americans reported having a low or no credit score, 41% for Hispanics, 37% for whites, and 18% for Asian Americans.” Not only does it have an effect on race, but also gender. In the past, women faced many challenges in gaining credit and were required to have male cosigners and large down payments to get loans, until the Equal Credit Opportunity Act of 1974 was made. This law prohibited several practices that restricted women’s access to credit and their ability to be financially self-reliant. Today, the average credit score of the two genders is almost identical and both carry essentially the same level of credit card debt.



Social credit scores typically begin when you start using credit, whether that’s opening your first line of credit such as a credit card or a student loan. This means that it has already affected me, and probably most of us in this class as most all of us have credit cards and are using loans for college. It affects us because our credit score is determined by the way we use that initial credit account and builds from there. It has a huge impact on our financial future and the decisions we make. For example, it affects our generation and our everyday life in many ways such as when you go to buy a house, get better interest rates on loans and credit cards, getting a job, renting an apartment, refinancing loans, buying a car, getting a cell phone, setting up utility accounts, paying for insurance, etc. Overall, Social credit scores are not only so important to know, but to also know the negatives and positives of having them, understand how to have a high credit score, and the effects that it has on our society and our everyday life.