CHINA’S second most popular e-commerce firm JD.com Inc. is launching a Chinese consumer credit data system as a joint venture with U.S. credit-scoring technology company ZestFinance, taking on a rival service linked to the larger Alibaba Group Holding Ltd.

    JD-ZestFinance Gaia, as the joint venture will be known, will use the U.S. firm’s machine learning technology to analyze JD.com’s online shoppers’ data and churn out a credit risk score, according to a joint press release Friday.

    The companies said JD.com will invest an undisclosed sum in ZestFinance.

    JD-ZestFinance Gaia and competitor Sesame Credit, part of Alibaba-affiliated Ant Financial Services Group, hope to use the e-commerce sites’ vast swathes of shopping data to turn out a reliable credit risk score.

    Assigning people and businesses accurate credit risk scores has been difficult in China, in part due to a lack of publicly available data and little information-sharing between financial institutions.

    Creating an accurate credit profiling system could potentially be lucrative, both for making safe bets on lending to customers who can then spend more on online shopping, and by selling the profiles to third parties.

    (SD-Agencies)