The need for the ethical use of personal data, especially in the financial sector, needs to be a major topic of discussion as technology advances. This will ensure the “Financial Technology” industry does not encourage marginalisation or exclusion of customers.
The quarterly Fintech Report by privacy International launched in November 2017 indicates how the financial sector is disrupting human rights, privacy and identity laws. Today, Fintech, in most cases, requires access to sensitive data and information which is analyzed by those in the industry. Fintech can also have access to one’s social media.
For Fintech Applications, Social media can be used to determine a clients credit score. A Facebook which shows how a client gets drunk or where they party can impact their credit score and the customers’ ability to pay the loan. Social media acts as a digital footprint for users and information posted on such platform can be accessed by financial institutions.
Fintech application where one can use social media to register the plug-in is added to the customers’ on-line loan application. This will then collect data from the clients Facebook including and not limited to basic data (such as education, relationship status, workplace, number of friends), likes, groups they belong to, status updates, locations, a selection of information on the applicant’s friends, education and workplace. All this data will then be used to determine a client’s credit score.
However, Facebook changed its platform policy, introducing the prohibition on using Facebook data for scoring. There are other ways beyond Facebook which can be used as has been used with Tala, a Fintech financial app. The application uses the number of connections that an individual has
How much time a client uses online is also a factor used. Too much time spent on social media could signify a person is unemployed, has too much time on their hands or is a social media entrepreneur. This is a not a defined determinant since life lived on social media may not necessarily be life actually lived.
Using social media to determine the credit score infringes on the Human Right to Privacy as it is under Article 31 of the Kenyan Constitution. The Fintech industry should seek to protect the right to privacy of every individual. Social media should also not be a basis to determine whether a client will receive a loan.