China will roll out preferential policies that will enable small and medium-sized enterprises to get loans based on their social credit scores as part of the efforts to lower financing costs for the sector, according to a top official with the nation’s top economic regulator.

The government will evaluate credit information collected in the social credit system and self-declared information of small and micro enterprises and then share the information with financial institutions so as to give assistance based on companies’ performance.

Such efforts are expected to improve the channels for small-sized enterprise to get financing, as companies with higher ratings will get loans in a short period of time, said Lian Weiliang, vice-chairman of the National Development and Reform Commission, during the annual Credit System Construction Forum held in Fuzhou, Fujian province on June 10.

Companies with high ratings will also get loans with preferential interest rates, according to Lian.

A total of 34 financial institutions and private tech platforms such as JD Finance and Alibaba’s Sesame Credit, will help the government develop the system, together providing services to enterprises.

Zhou Jun, a senior manager with Golden Credit Rating, said such measures, which are expected to be combined with China’s inclusive finance projects, will benefit small enterprises struggling to get financing by providing more customized services.

China has launched pilot programs in some regions, where local governments set their own standards, granting small and medium-sized enterprises some level of privileges according to their ratings in the social credit system.

More than 600 enterprises have already received approvals after they sought loans from local financial institutions in Zhangjiang Hi-Tech Park in Shanghai, also known as China’s Silicon Valley, according to Lian.

Chen Hongwan, head of fiscal and financial affairs department of the NDRC, said the government will introduce more measures and make sure enterprises and individuals with high social credit ratings will receive more benefits, while those with low ratings may incur punishments.

Starting from 2014, the government has stepped up efforts to build a nationwide social credit system, aiming to honor credibility and promote trust in the society and create a harmonious social atmosphere.

The government collects information from individuals and enterprises, giving them social scores which can move up and down depending on their behaviors.

The government will ensure data privacy while rating participants, according to the NDRC.

The nationwide program is expected to become fully operational by 2020, and the rough overall structure has been established, according to Lian.