Now to a new installment of our special series "CGTN Probes". The Chinese government is currently developing a specialized system which rates its citizens' behavior in different social and economic settings. While it's being hailed in China as innovative governance, the West isn't so convinced, with many believing it's nothing more than invasive surveillance. CGTN's Xu Mengqi looks at both sides.

XU MENGQI SHANGHAI "OK, so there is a fair amount of interest in China's social credit system in the English-language media, but not all of the reports are 100% truthful. My name is Xu Mengqi, and in this episode of CGTN Probes, I'll take you to the inside of the so-called social credit system."

From occupying other people's seats, and sneaking through the subway without a ticket, to the more recent vaccine scandal.

These acts of bad faith might mean you're labeled "untrustworthy" under the new social credit system in China. The goal, according to the government, is to create a society where "integrity is honored and transgression is shamed."

Sounds reasonable in theory, but how does it stand up in real-life, practical scenarios? To find out, I visited Yiwu, one of the scheme's first pilot cities, also known for its small commodities market. Here I met Meng Zhihao, a toy supplier who had no idea that he had a social credit score until last May.

MENG ZHIHAO TOY SUPPLIER IN YIWU "My bank came promoting a quick loan project to me, and only people with good credit could apply. It was then that I knew."

Meng was approved a 300-thousand RMB loan in no time.

To better understand how Meng's score was generated, I visited the very man who was behind it, the director of Yiwu's pilot program.

CHEN QI, DIRECTOR YIWU SOCIAL CREDIT OFFICE "In terms of information collection, it is us, the credit office, who creates the catalogue for data collection. Each department then submits their data to a central platform according to the catalogue, forming one big library for market entities and another for individuals. And the case with the quick loan that you saw, is also a product we launched. Those with good credit can apply for the loan online."

XU MENGQI YIWU "So according to this official handbook, here in Yiwu, credit-boosting behavior includes donating blood, volunteering and doing charity work, whereas conduct like defaulting on court judgments, salary payment or loans will result in a loss of credit. Well, it is pretty straightforward about what authorities want, but designing such a mechanism is one thing, and getting people to know it and use it is another."

A few hundred miles north of Yiwu, the city of Nanjing runs a slightly different pilot scheme.

No one score is given here to rate a citizen's creditworthiness. However, just like Yiwu, their behaviour is fed into a centralized database for official use.

YIN XIAOJUN, DIRECTOR NANJING CREDIT INFORMATION CENTER "This platform is designed for government organs and various administrative roles. It provides information needed for administration and social service."

Yin Xiaojun is the platform's technical operations manager. And he's conscious of the need to protect personal data.

YIN XIAOJUN, DIRECTOR NANJING CREDIT INFORMATION CENTER "Accessing credit records is traceable. So when you make an enquiry, the system logs it automatically."

"The city of Nanjing has launched a mobile application that offers synchronized information to individuals."

Back at Yiwu, civil servant Zhou Ying says she spends most of her time at work explaining to people about the social credit system.

ZHOU YING, STAFF YIWU CREDIT INFORMATION CENTER "Many people are surprised that so much information about them is contained in their credit report. They think this information is a bit sensitive and involves their privacy. But we would explain to them that the report can only be seen by the person themselves, unless they authorize someone else to make an enquiry."

Professor Dai Xin – a keen observer of social credit ratings - says while the system may look dubious to some, it has plenty of substance.

DAI XIN, PROFESSOR LAW SCHOOL, OCEAN UNIVERSITY OF CHINA "The social credit system project of China, you can actually think of it more like the continuance of e-gov't project which started even earlier, which is just to transform the way the gov't does their own business. You know, if the west considers the gov't is doing this only because the gov't is trying to have more control, then I think that is a huge misconception, because I think there is definitely a genuine need that people have for the gov't to deliver better service and the gov't is trying to respond."

"Governance is definitely necessary. You can't rely on those people to be self-disciplined. Say the jaywalkers, they take advantage of those few seconds. But if there is an accident, who is to blame? Isn't this doing harm to others? People who don't follow rules are the most terrifying. I don't like it."

Reporter "Do you think this is a good thing or a bad thing?"

"It depends on the specific plan."

"Trustworthiness in society needs to start with the government. The government needs to keep its word and set the right direction."

Aware of the potential problems of the social credit system, Long Xiang, chairman of Nanjing's municipal legislature has proposed to accelerate the establishment of a law at this year's National People's Congress.

LONG XIANG NATIONAL PEOPLE'S CONGRESS DEPUTY "We need to be extra cautious when collecting data from citizens. The standard for what constitutes social credit information needs to be clarified beforehand. What can be collected, what needs authorization for use must be prescribed in the law. We also need to grant subjects the right to appeal, and restore their credit. And I shall also emphasize, that only when the government upholds its own integrity and is transparent, fair and just, will the social credit system work as intended."

XU MENGQI SHANGHAI "So far, several provinces in cities including Shanghai have released their own regulations on social credit. But the national-level law is yet to be established. Experts who are private to this matter say right now still a just third-tier priority on the NPC's legislative agenda, meaning a national-level law is probably not going to happen in the near future. And the reason could be the central government has already realize how complicated the social credit system could be when it is really put into practice. That's it for this editon of CGTN PROBES. I'm Xu Mengqi reporting from Yiwu, Nan JING in SHANGHAI."