The technological era has made 'Data is the new gold' a common phrase these days. It turns out to be true as few researchers at the International Monetary Fund agree. Mega companies are now under radar for how they use user data. In an IMF blog post, four researchers put forward findings from a paper in the works which looks at the relationship between finance and tech, and how it is expected to grow.
An individual's browsing history, purchase history, and search patterns should be used to decide the credit score of every user, claims the research findings. The researchers firmly believe this would be the more accurate way to determine the credit rating than it does right now. They added these models would allow greater lending for borrowers which the traditional banks would have been denied. IMF researchers believe that banking system as it exists right now faces a serious threat from tech companies like Facebook, Google, and Apple.
The research found that such companies have a lot more access to soft-information, and that message based platforms could replace physical banks, these companies are facing more scrutiny across the globe for they use our data. The researchers also mentioned in the blog that the privacy and policy shortcomings and worries that are part of such kind of policies. The research study is still in its pilot phases, and perhaps soon, the researchers could pinpoint to a mechanism which would make this possible. Till then user can browse away freely..