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Time for an ethical framework
11 April 2019
We urgently need for an ethical framework for the use of big data or we risk undermining the social purpose of financial services, says the ICAEW.
The accountancy body is calling for businesses, consumers and regulators to work together to protect vulnerable people from being exploited by the growing use of data and artificial intelligence.
The growing use of big data (which includes data from social media, video watching habits, location data and photos to satellite images, traffic flows, and data from smart devices) and AI is increasingly changing financial products like credit cards and insurance policies – as well as the business models of the companies that provide them.
There will be winners and losers as a result of these changes. However, the ICAEW says banks, insurers and other financial service providers need to start managing these tensions now, before products and services spiral away from their true social purpose.
Without an ethical approach to using big data, people could be unfairly or illegally excluded from vital financial services, leaving them without access to insurance or credit, owing to factors they cannot control like gender, ethnicity, where they live, or health conditions. This will also be influenced by factors like where they shop, whether they use cash instead of cards and other information.
These new sources of data and the ever-growing ability to process them, also opens customers up to exploitation. This could include targeting people when they are more vulnerable or offering inducements to increase spending through exploiting behavioural biases.
The ICAEW’s Philippa Kelly said: “ICAEW’s ethical framework will help make sure banks, insurers and other financial services providers don’t take unfair advantage of this information, and it is used for designing more tailored and suitable products to meet customers; needs.”
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