Lessons From U.S. For China
If America's financial services industry had the opportunity to start from scratch in building a system of consumer household credit, how would the program be conceived and implemented?
Such a scenario is impossible in the U.S., but not in China, where the retail financial services industry is emerging, including more than 35,000 credit cooperatives that are similar to credit unions.
To examine that question, the Filene Research Institute and CUNA Mutual Group co-sponsored an International Workshop on Household Credit at Beijing University. Facilitated by Professor Bruce Reynolds of the University of Virginia, the workshop consisted of white papers presented by experts in a variety of consumer lending areas including China's institutional factors, foundations necessary for creating a consumer credit model, special needs of rural areas, and broad policy issues raised by the growth of consumer credit.
According to Filene, of particular concern to workshop organizers was consideration of cultural issues as well as technical issues in developing a consumer credit paradigm in China. "While the technical aspects of economics and business can be readily communicated," said Bill Kelly, director of the Center for Credit Union Research at the University of Wisconsin, "cultural influences on economics and business vary by country and culture. In transferring learning, we need to understand factors that depend largely on culture."
The workshop on household credit was the most recent development in a relationship forged between Filene and the Center for Chinese Economic Research (CCER) at the University of Beijing, the leading academic economic research institution in China.
Workshop participants were primarily economists from academic institutions and financial and governmental institutions in the U.S., China, Germany and Australia.