I have been outspoken in the past on the US Administration speaking out on things they hardly understand, more specifically the nuts and fruits division (aka US Senate and US Congress), yet this morning I got confronted with one of such calls and I find it hard to disagree. The article that I initially saw on ABC (at https://www.abc.net.au/news/2020-11-09/google-facebook-banking-senate-inquiry-fintech/12856080) where we get told ‘Senate inquiry asks whether Facebook, Google should be regulated like banks’ is the foundation of a much larger stage, and in the I find it weird that Apple is not named either. You see the quote “The inquiry — which in September handed down an interim report into other issues including regulation of buy now, pay later platforms such as Afterpay and Zip — is now examining whether it is dangerous to have large tech giants offering banking or other financial services”, is more than simply on the money, there is a whole range of services pushed and prodded towards consumers, if anything, the fact that players are faced with games like Gardenscape who continue their deceptive advertising trough games is a mere indication of how bad it could get. There is a basic level of protection that consumers are entitled to and as I personally see it they will not be getting it.
Now, if these tech providers want to facilitate financial services whilst their services are not linked and behind a Chinese wall, isolating data and speculative insight away from the financial services it is one thing, it would level the playing field with the other providers. Yet in it current stage that setting is indeed extremely unbalanced, unbalanced towards their competitors and more important it will be unbalanced for the consumers who need a honest chance.
So whilst we are getting treated to “Senator Bragg says our personal data has become an asset and the tech giants could be regulated so they use it fairly”, my response towards Andrew Bragg is that he is wrong, or perhaps incorrect is a much better word here, it is not regulation, it is isolation from internal and external data sources. Which means that if Banco Googly wants to extent a loan to Jack the Keyboard Hammer for a $99 new keyboard, they will have to do their own due diligence and use the methods the other banks and financial services have. That is the only way to keep level playing field.
Now, player like Google Facebook and Apple might claim that the data link will allow cheaper loans, the might optionally be true, but when you get to the other side of the seesaw, and the seesaw is down for you, the data links might give you less options or more expensive options for the longest of times and the would not be fair. In that regard, have you ever seen ANY financial institution who set your wellbeing over their need for profit, please give me their name, because the alleged law firm known as Mandacious, Dissembling and Sneaky, who will inform you that there are leagues of financial institutions the always have your wellbeing at heart, all whilst you know that there are none that actually do.
So, yes, I do believe the these tech giant have a much larger drive to own more and more money and there is nothing wrong with the, but they are doing it with a massive unfair advantage leaving banks with the empty jar of watered down milk as tech giants get to skim the cream of every milk delivery, it would be an unfair advantage, with larger implications when they start connecting financial data to the data the they already have, it would be a stage where we get a larger segregation of those who have versus those who have not. A stage that Dutch Journalist and tech savvy person Luc Sala warned us all against in the late 80’s, so 30 years ago he saw this level of segregation through technology, and when did personal segregation EVER have positive consequences? Ask the African Americans, the US Latino’s, optionally Native American Indians. Ask them what positive result they saw from segregation. Oh, and by the way good luck getting out of the room alive when you ask.
Yet there is a larger stage the Google, Apple and Facebook will face and they already have the larger pieces in place to avoid them, as such regulation does not solve anything, it merely gives rise to legal loopholes, as I personally see it, the segregation of those services is the only decently clean and complete stage the void a lot of traps (most of them, not all), there is a larger stage where Google, Apple, Facebook and Amazon (yup they are in it too) can set the stage of offering testing data, but the should only be allowed if that data is open to all financial institutions and for the same price. You see, they are not alone, that field has has layers like Equifax, TransUnion, Dun & Bradstreet, LexisNexis and a few more, as such there is a stage where their data has more unequal benefits, which is interesting, the article never mentioned them, so whilst some are amazed by people like Andrew Bragg and their PowerPoint voice, yet the data keepers the re out in the field now are not on the ticket here, it seems weird as they have been around and their impact is not to be ignored, so why did Andrew Bragg miss that?
And the final quote is “Senator Bragg calls it a “game changer”, although critics have pointed out that without careful consideration, it could have serious privacy implications, among other concerns”, so what is his game, when we see ‘serious privacy implications’, I merely wonder who is buttering his bread, because the few I mentioned have a much larger impact, one the is never to be ignored and they have been involved in the financial industry almost forever setting the bar of allowed data versus insincere, or unjust data, a term that should have been in the article as well. You see the unequal field is created by some having more data as well as second degree data. Second degree, or secondary data is where it is at. We can consider that Secondary data refers to data, collected by someone other than the user. Yet what is the case is that these sources of secondary data is often collected for other means and other settings, like social science which includes censuses, information collected by government ad commercial departments for other means; organisational records and data that was originally collected for other research purposes, research purposes that are now reused without the users knowledge. And that is beside the station that some of this data is cleaned badly, and often linked to settings the are no longer relevant, yet they are there connected to a user setting an unrealistic view and optionally ignoring the setting that the created debt is false. The person will soon learn the he/she cannot pay it back, or it is rated as just that little more expensive.
All stations that players like Experian and Dunn & Bradstreet arm against, for their needs as well as the good of the people. These tech giants are nowhere near the level of clean (and optionally corrected) data. As such there is a fair call to disallow these tech giants their Fintech arm, unless it is completely isolated from their other business arms.