Big Business is now Big Brother. With the proliferation of data available to credit card companies, is it really surprising that spending patterns can be scrutinized to ascertain a person’s lifestyle and so much more. Yale Law Professor Ian Ayres in his book “Super Crunchers” says that Visa has the ability and wants to know if your marriage is headed for the rocks. The theory is that people going through divorce are more likely to miss payments, which is of significant interest to credit card company risk managers.
It has also been reported that data crunching has been used by big box retailers like Canadian Tire to create psychological profiles of its customers. Who knew that your purchase of a fly swatter or a carbon monoxide alarm could assist in a DSM analysis?
Maryland State legislator Saqib Ali introduced a bill called the Credit Card Blacklisting Prevention Act to prevent credit card companies from reducing credit limits or increasing interest rates based on shopping patterns and spending habits of credit card holders. The bill has passed the Senate and is expected to become law, the first of its kind in North America.