While it’s true that the Chinese government intends to create what it calls a “social credit system,” Sesame Credit and its competitors (of which there will soon be several) have little to do with such plans—at least for now.
How it actually works
Ant Financial tells Quartz that Sesame Credit is not a silly game, but the first system in China to incorporate online and offline data to generate credit scores. Scores go up or down based on five categories:
The first category takes into account purchases made using Alipay, and looks at purchasing volume, and the price of goods that are purchased. But the content of what one purchases won’t affect one’s score—in other words, your score will go up as long as you buy anything, whether it’s books or sex toys. “It’s basically the frequency that matters, it’s not what you buy that matters,” says an Ant Financial spokeswoman.
The second category involves personal information, like one’s job and hukou (household registration status). The company uses this information to better understand its users, and entering information results in a higher score, explains the spokeswoman. It wants this data because it helps the service be more comprehensive. But, she emphasizes, the scores won’t go up or down based on one’s profession. “Let’s say in China you have a Shanghai hukou. That doesn’t mean you have a better Sesame Credit score versus [someone in] Tibet. We don’t discriminate [based on] where you are from,” she says.
Sesame Credit works more like a loyalty program than a credit rating system. The third and fourth categories measure timely payments on bills and credit cards, respectively. Many Alipay users pay their bills through the mobile app and receive reminders through push notifications on their phones. Failing to pay a bill on time will cause one’s score to go down, and is probably the most important category, the spokeswoman implied: “We wouldn’t say that if you have a good career track or a bad one it will affect your score as much than as if you don’t pay your bills.”
Finally, when more friends join Sesame Credit, your score will go up. A score will not go up or down based on the scores or personal information of your friend group, though.