Ant Financial-backed Hello Chuxing says its user credit system led to significant decrease in damaged bicycles

Careless parking and vandalism have been some of the stumbling blocks for China’s bike-sharing sector.

Hello Chuxing, previously known as HelloBike, has seen a 37% year-on-year drop in damaged bicycles as a result of its credit scoring system, Sina Tech reports.

Backed by Ant Financial, Hello Chuxing is China’s third-largest player in China’s the bicycle-sharing market, according to market reports by research firm iiMedia cited by Caixin.

The company’s credit system evaluates user behaviour and rewards or punishes them accordingly. Upstanding users who follow traffic regulations, report vehicle faults, and tend properly for their bicycles will see their credit scores increase, while credit score deductions are dished to those with bad behaviour.

Users with high credit scores can enjoy perks like free rides and discounts. Users with low scores may experience higher prices or get temporarily or permanently banned from renting bikes.

According to data released by Hello Chuxing, the rate of damaged bicycles dropped in the 300 cities in which the company operates. Cities with the greatest improvement experienced a more than 60% decline in damaged bicycles.

Credit deduction warnings have been issued to more than 30,000 users. Of these, more than 10,000 have had their accounts temporarily frozen because of scores dropping below 50 points, and 3,000 people have been permanently banned after their credit scores fell to zero.

Hello Chuxing announced a strategic cooperation with Ant Financial-owned Sesame Credit in 2017, and three months ago revealed that it had raised RMB4 billion (US$583 million) in new funding led by Ant Financial and Primavera Capital Group.

Damaged bicycles have been part and parcel of China’s bike-sharing craze, which took off in 2017. Streets and sidewalks cluttered with haphazardly parked rental bikes are also a common sight. User credit systems like Hello Chuxing’s are widely viewed as a solution to counteract the growing pains of a nascent industry.