Government Scheme Gives Moral Citizens Easy Credit
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2017-08-29 12:26:11

Banks in eastern China have lent millions of yuan to virtuous families and individuals as part of a scheme to boost local morality, Sixth Tone’s sister publication The Paper reported Tuesday.

In June and July, banks in Jinhua, a city in Zhejiang province, allowed families and individuals who had received government awards for their integrity to take out loans of up to 500,000 yuan ($76,000) without offering any collateral. In total, they lent out 890 million yuan to such parties, the report said.

The program is a joint effort from the local government and the city’s bank branches — many of which are state-owned — to encourage citizens to be morally upstanding. Recipients who showed honesty, generosity, workplace dedication, and other positive personality traits and were therefore given government awards — such as the “Civilized Family,” “Moral Model,” or “Good People in Jinhua” — are eligible for the easy credit.

“Just as with other loan applicants, the virtuous families and individuals need to follow the bank’s regulations and standards,” Gong Hengqing, the credit section chief at the Jinhua branch of the People’s Bank of China, told Sixth Tone. “But the bank will prioritize their applications and give them lower rates.” The upper limit for the loan — anywhere from 100,000 to 500,000 yuan — depends on which level of government bestowed the award.

Gong said that since the applicants had received awards from the government, a considerable amount of time was saved in reviewing their qualifications. “We trust the credibility of the government,” he said.

Teng Jianbin, an employee at Jinhua’s civilization office, told Sixth Tone that the various integrity awards were given out after a strict screening process, and with the express approval of county-level to municipal-level governments. “With every award, the government will put the list of candidates on the Civilization Office’s website and send the list to local media for public supervision,” said Teng.

According a report by Zhejiang Daily, the idea of linking integrity awards with bank loans was first implemented in one of the province’s counties last September. After the idea received praise from a China Central Television program on this year’s World Consumer Rights Day — March 15 — the government of Jinhua decided to promote the scheme across the city, Gong said.

Officials in Jinhua hope the total value of loans awarded will reach 1 billion yuan by the end of 2017.

Yuyao, another city in Zhejiang, in 2012 launched a “moral bank” that grades citizens’ behavior and standing among their neighbors in return for bank loans. Financial benefits for the morally affluent also underpin Sesame Credit, a credit scoring system built into Alipay, a popular digital finance app. And in April, bike-sharing companies signed an agreement with the government to use a centralized credit system aimed at improving user behavior.

Editor: Kevin Schoenmakers.

(Header image: Two women hold ‘moral behavior’ certificates awarded by the women’s association in Ruicheng Village, Shanxi province, March 8, 2015, Liu Baocheng/VCG)