(ECNS) -- China's Internet financial institutions will include the credit information system, said Chen Yulu, deputy governor of the People's Bank of China.
As an effective supplement to traditional banks, online finance has boomed in China in recent years but it suffers from risks such as fraud and debt evasion.
Insiders say the move guarantees healthy and orderly development of the industry by preventing malicious lending, cutting transaction costs, and safeguarding the rights of lenders in peer-to-peer loans through online platforms.
Chen said China’s current credit system is moving ahead on two wheels, driven by both the government and the market.
At present, there are 125 companies and 97 institutions in the field of personal credit information, most of which are funded by private capital, reported Securities Times newspaper.
Meanwhile, the People's Bank of China approved Baihang Credit Scoring, which is backed by Alibaba and Tencent among others, and has registered capital of one billion yuan ($149 million).
Baihang Credit Scoring, which has included credit information from more than 600 institutions, officially launched three credit service products, including personal credit reports, in January.