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Preliminary research findings in big data analysis of China's guarantee circle (No 165, 2014)


By Chen Daofu, Institute for Finance Research, Development Research Center of the State Council (DRC), & Liu Xinhai, Credit Information System Bureau, People's Bank of China

Report No 165, 2014 (Total 4664)


Mutual and joint guarantee has become a major cause behind distrust among enterprises, the rapid rebound of bad loans in banks, and the contact lost of a large number of private entrepreneurs. As relations in the guarantee circle became complicated and non-transparent, traditional methods have failed to find the key guarantee groups and enterprises rapidly, causing the risk of mutual and joint guarantee to spread swiftly. Consequently, it is necessary, on the basis of the big data of the credit information system of the People's Bank of China, to make in-depth data mining through the use of sophisticated network analysis to create conditions for risk management and prevention. The paper gives a preliminary analysis of the country's large and medium-sized enterprises and all the guarantee circles in Wenzhou, Zhejiang province, and found the key guarantee groups and enterprises, providing a foundation for dealing with relevant risks. In addition, it offers three suggestions on the use of guarantee circles' information with big data mining. It is hoped that under the downward pressure of economic development, relevant departments could make thorough analysis of guarantee circles as soon as possible to address related risks.