According to reports, Dutch privacy advocate, AP, has written the major Dutch banking association (NVB) providing guidelines for how banks can cross-promote products. The group contends that banks should not offer products based on tracking of customer trends that the bank might be privy to through data. One of the banks under the microscope is ING, who had plans to do just that. Consumers have expressed questions of privacy in terms of information on their spending habits.
The AP stated, “Payment details really give a complete picture of someone’s life: where you spend your money, the associations you belong to, who you get on with, visible patterns. This is why the AP thinks it’s important to remind the banking sector about privacy regulations.”
The debate is an interesting one when it comes to data, as it is commonplace in marketing to target consumers based on information obtained through online shopping and spending. The first time a consumer searches online for a potential vacation to the Caribbean, it can be a little startling when offers from various hotels from the Caribbean follow the consumer wherever he or she goes online.
It is understandable that a bank customer could feel a breach of trust if the person knows it is their trusted bank that is using data to promote products based on the banking information. European watch dog groups in particular, however, are quite keen to limit this type of information being exploited for marketing purposes. Email marketing laws in Europe, for instance, are far stricter than the United States.
While most consumers do not have the time or would even think of looking at their bank’s privacy statement, it can show a bank’s intention for using the information and can set off red flags for consumer protection groups.
Banks such as ING, one of the banks under the microscope, can contend that if the information is used to provide helpful services for its customers then it can be a benefit to the clients to be made aware of some of the services. However, the perception of a consumer is crucial, and when it comes to a bank’s brand trust can be more important than a short-term opportunity.
- Securing Lifelong Customers in a Disruptive Banking Market: Lessons Learned from Other Industries
- US “cashless society” Some Way Off, Survey Finds
- Five Things the Federal Reserve is Considering in Developing a Digital Currency
- Citizens Hits Back at CFPB’s Lawsuit Over Credit Card Dispute Failings
- Temenos Joins Forces with Google Cloud After ‘Explosive’ Trend in Banking