In a move that has shocked the western world, China has implemented a new "social credit" system. Now, reports have revealed that the system is being used to block certain citizens from traveling based on certain behaviors and minor past offenses that appear on their permanent record.

According to the National Public Credit Information Center, this new rule has affected around 17.5 million transactions in 2018 across the nation. The ban isn't only limited to airfare; 5.5 million train ticket transactions were also affected.

The system has been criticized by the West for being too "Orwellian," with many questioning the ethics behind such closely monitored, state-sponsored surveillance systems that often involve genetic sequencing. Western companies like Massachusetts-based Thermo Fisher Scientific Inc. (TMO  ) have stopped selling or assisting its genetic sequencing products to the province of Xinjiang after receiving word that its technology was used as part of the program. s

The social credit system was apparently initiated in 2013, when the ruling party began targeting "indebted citizens" on a supposed blacklist. The government has a network of informers and integrated AI systems that collect and collate disparate pieces of information about individuals and store them in a centralized database, effectively creating personal dossiers for people. It acts much like a credit score, but includes nonfinancial factors. The central database could include things like tax reports, fine payments, criminal history, and debt records, which are aggregated to eventually produce each person's social credit score. Beyond travel, people can also be restricted from purchasing insurance, real estate, or investment products. The system isn't limited to individuals; it can also impact large corporations by preventing the from bidding on certain projects or issuing debts.

The report further stated that more than 14 million data points of "untrustworthy conduct" last year, including scams, unpaid loans, false advertising and occupying reserved seats on a train. According to a government document regarding the system from 2014, the social credit initiative's aim is to "allow the trustworthy to roam everywhere under heaven while making it hard for the discredited to take a single step."

The government has also gone on to state that 3.5 million people and companies paid taxes or debts they owed because of the social credit system, raising questions regarding its efficiency. Though the system may be considered conventionally "efficient," it is certainly not equitable, as it redistributes resources in a way that does not take into account people's economic backgrounds.