Don’t miss Mara Hvistendah’s excellent piece on China’s Zhima social credit system on WIRED. Some highlights:
If you live in the United States, you are by now accustomed to relinquishing your data to corporations. Credit card companies know when you run up bar tabs or buy sex toys. Facebook knows if you like Tasty cooking videos or Breitbart News. Uber knows where you go and how you behave en route. But Alipay knows all of these things about its users and more. Owned by Ant Financial, an affiliate of the massive Alibaba corporation, Alipay is sometimes called a super app. Its main competitor, WeChat, belongs to the social and gaming giant Tencent. Alipay and WeChat are less like individual apps than entire ecosystems. Whenever Liu opened Alipay on his phone, he saw a neat grid of icons that vaguely resembled the home screen on his Samsung. Some of the icons were themselves full-blown third-party apps. If he wanted to, he could access Airbnb, Uber, or Uber’s Chinese rival Didi, entirely from inside Alipay. It was as if Amazon had swallowed eBay, Apple News, Groupon, American Express, Citibank, and YouTube—and could siphon up data from all of them.
In 2015 Ant Financial was one of eight tech companies granted approval from the People’s Bank of China to develop their own private credit scoring platforms. Zhima Credit appeared in the Alipay app shortly after that. The service tracks your behavior on the app to arrive at a score between 350 and 950, and offers perks and rewards to those with good scores. Zhima Credit’s algorithm considers not only whether you repay your bills but also what you buy, what degrees you hold, and the scores of your friends. Like Fair and Isaac decades earlier, Ant Financial executives talked publicly about how a data-driven approach would open up the financial system to people who had been locked out, like students and rural Chinese. For the more than 200 million Alipay users who have opted in to Zhima Credit, the sell is clear: Your data will magically open doors for you.
The algorithm behind my Zhima Credit score is a corporate secret. Ant Financial officially lists five broad categories of information that feed into the score, but the company provides only the barest of details about how these ingredients are cooked together. Like any conventional credit scoring system, Zhima Credit monitors my spending history and whether I have repaid my loans. But elsewhere the algorithm veers into voodoo, or worse. A category called Connections considers the credit of my contacts in Alipay’s social network. Characteristics takes into consideration what kind of car I drive, where I work, and where I went to school. A category called Behavior, meanwhile, scrutinizes the nuances of my consumer life, zeroing in on actions that purportedly correlate with good credit. Shortly after Zhima Credit’s launch, the company’s technology director, Li Yingyun, told the Chinese magazine Caixin that spending behavior like buying diapers, say, could boost one’s score, while playing videogames for hours on end could lower it. Online speculation held that donating to charity, presumably through Alipay’s built-in donation service, was good. But I’m not sure whether the $3 I gave for feeding brown bear cubs qualifies me as a philanthropist or a cheapskate.