IMF blog post floats idea of web history being factored into credit scoring

The IMF is under fire on social media after publishing a blog post that many worry if implemented would present an intrusion into their online privacy.

Time will tell whether the concerns for an Orwellian nightmare or future that looks like a dystopian episode of “Black Mirror” this blog post created will be justified.

In the post, the IMF suggests history of online searches and purchases be factored into credit scoring, justifying the potential intrusive data collection by writing “these alternative data sources are often superior than traditional credit assessment method.”

The IMF Blog writes:

The second and most complex problem is that certain kinds of people, like new entrepreneurs, innovators and many informal workers might not have enough hard data available. Even a well-paid expatriate moving to the United States can be caught in the conundrum of not getting a credit card for lack of credit record, and not having a credit record for lack of credit cards.

Fintech resolves the dilemma by tapping various nonfinancial data: the type of browser and hardware used to access the internet, the history of online searches and purchases. Recent research documents that, once powered by artificial intelligence and machine learning, these alternative data sources are often superior than traditional credit assessment methods, and can advance financial inclusion, by, for example, enabling more credit to informal workers and households and firms in rural areas.

Needless to say, social media users were not impressed.

Here is just some of the reaction on Twitter.

“Social credit is here folks.”

“a psychotic idea from the ghouls at the International Monetary Fund”

“I thought this was an Onion article:”

“Hey, privacy people? We need to not let this future happen. Credit scores are already an oppressive violation, one which nobody can afford to opt out of. Imagine if turning off JavaScript and cookies meant you weren’t eligible for a bank account.”

“This is a good example of how ideas that spin out into dystopian visions unmoored from actual events in the China context are styled as rational and exciting in the context of “financial innovation.””

“Well that would be highly authoritarian since they would be trying to manipulate your behavior by restricting your access to money

It amazes me how many people actually want less freedom and more government control”

The IMF post is written by Arnoud Boot, professor of finance at the University of Amsterdam as well as Peter Hoffmann and Luc Laeven, who are economists with the European Central Bank, and Lev Ratnovski, an economist with the IMF.