Abstract: In 2010,China’s first investor-pay rating agency, China Bond Rating was established. Since investor-pay rating agencies have been established for only a short time in China, currently there is little domestic literature studying the differences and causes of differences between investor-pay and issuer-pay credit rating. On top of that, the foreign relevant literature mainly focuses on how the investor-pay and issuer-pay impact the rating results, but doesn’t discuss whether there is a difference between the investor-pay’s and issuer-pay’s impact on different types of bonds. In this paper, differences between investors’ payment and issuers’ payment rating are studied. Based on reputation effect and competition mechanism, game theory is applied to analyze the issuer-pay rating agencies’ catering to issuers. Moreover, the rating data of credit asset-backed securities and corporate bonds are used as samples to empirically test the rating difference and its causes by descriptive statistics,univariate analysis and multiple regression analysis. The findings of the research show that the result of the investor-pay credit rating is significantly lower than issuer-pay credit rating. The differences of rating results under different payment models are influenced by whether it is the first rating and the market share of the issuers. The main reason of the difference is that the issuer-pay rating agencies’ catering to issuers. The difference between investor-pay and issuer-pay credit rating in corporate bonds data is significantly higher than the credit asset-backed securities data, indicating that different payment method has a greater impact on corporate bonds. The differences between investor-pay and issuer-pay credit rating in China are comprehensively studied, which will make investors and regulators have a clearer understanding of the credit rating between investor-pay and issuer-pay rating agencies, and provide important reference for the further improvement and development of China’s credit rating industry.

Key words: investor-pay；issuer-pay；credit rating；credit asset-backed securities；corporate bond