Huabei users take note! Repay the loan on time, or your credit rating will be low

Ant Group's virtual credit card service Huabei said it will gradually include users' latest credit performance and how they've repaid bills in a monthly report to the central bank's credit rating system.

Ant's small loan affiliate Chongqing Ant Consumer Credit Co Ltd and other financial institutions offering credit lines to Ant users are responsible for filing credit rating information to the social credit system.

The personal credit report will include when the virtual credit account was set up, the total credit line and whether monthly bills are paid on time, it said on Wednesday.

It will update credit status with the central bank on a monthly basis.

Chongqing Ant Consumer Credit Co won approval to offer lending and other consumer finance-related services from the Chongqing bureau of the China Banking and Insurance Regulatory Commission in June as part of the financial tech giant's overhaul of its consumer loan business.

Huabei has begun to roll out an updated version of its user agreement starting earlier this week, and those who decline to allow Huabei's credit information to become part of the central bank's credit system will no longer be able to use the service.

It also reiterated that keeping track of small loans and paying monthly credit bills on time won't affect consumers' credit ratings or future loan applications.

Huabei's credit line ranges from several hundred yuan to hundreds of thousands of yuan based on each user's payment and consumption habits.

"Those who occasionally use the virtual credit service have nothing to worry about as long as their monthly bills are paid on time," said one online commentator Zhang Yixuan on Weibo.

Ant also cautioned users be wary of scammers who claim they can improve credit rating reports or remove records for bad loans.

"Keeping track of the credit rating of those not yet served by traditional financial institutions will be helpful for a well-rounded and integrated credit system," commented Bian Yongzu, a researcher at the Chongyang Institute for Financial Studies at Renmin University.

Ant has been ambitious in linking the Huabei service with more online and offline merchants and has offered interest-free installment payments for selected big-ticket items to encourage users to use the virtual credit service, but has walked these plans back after being told by regulators to separate its financial offerings from payment tools.