From the IMF blog post[1]:<p>> <i>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.<p>> 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.</i><p>I enjoy the framing of this; give us the keys to the kingdom and we'll give you even more credit (to get yourself further into debt!)<p>Of course it won't stop there, better pay down that mortgage before you search or buy the "wrong" thing if you want to keep your house (they won't take it outright, just raise the interest rate on your loan because you now represent a higher risk based on "new information")<p>[1] <a href="https://blogs.imf.org/2020/12/17/what-is-really-new-in-fintech/" rel="nofollow">https://blogs.imf.org/2020/12/17/what-is-really-new-in-finte...</a>
The article talks about things like browser, ISP, etc and not so much browser history. Even so, this is the worst possible type of pattern matching. It’s easy for some to manipulate but really bakes in the worst bias.<p>People with the means can easily change their computer - You go from a budget pc running an old version of windows to a brand new Mac and your credit score goes up.<p>On the flip side your isp may indicate you live in a “bad neighborhood” and get penalized for it.<p>We have all got to hope this never gets implemented.
Well of course! The real question is: what <i>shouldn't</i> impact your credit score? Any information you consume could potentially impact your ability to repay a debt - if you read the wrong book, see the wrong movie, visit the wrong person, any of these events could change your mind, and make you a less reliable credit risk. Reading the wrong web resources is a natural extension.<p>(Because the actually crazy people have killed satire, let me be clear: this is satire.)
A better conversation is whether IMF/credit scores deserve to exist in the first place. Didn't these geniuses JUST add field-specific search to SWIFT, so orders for "cubanos" don't get held up because of Cuba sanctions?<p>Maybe these clueless old men should stick to what they know - mountains of physical paperwork and pointless policies and procedures, and stay away from anything that uses electricity or internet.<p>Bitcon/DeFi will render them obsolete in a few years' time anyway.
Credit scores are so fundamentally broken anyway.<p>In financial analysis of a company, the number one item you tend to look at is "free cash flow" - the "cash available for the company to repay creditors or pay dividends and interest to investors." [1]<p>Why then do we not take income into account in credit worthiness? Why do I not periodically upload my W2 or tax return to the credit bureaus in order to show that yes, I'm credit-worthy because my income makes it possible to service my debt?<p>The entire idea of a credit score based on having had credit and paying past loans off is asinine. To start throwing nonsensical parameters like browsing history into the equation is second derivative asinine.<p>[1] <a href="https://www.investopedia.com/terms/f/freecashflow.asp" rel="nofollow">https://www.investopedia.com/terms/f/freecashflow.asp</a>
It's like we need eternal vigilence against people like this or something. There is always someone who thinks they have a technocratic solution that optimizes for their own interests and then litigates for it and encircles us while insisting it is in ours. Nobody subject to this proposed measure desires it.<p>Why on earth does the IMF, an organization staffed almost exclusively by academic economists and political appointees, think they have any expertise whatsoever in consumer credit decisions? These are people whose understanding of business stops at "getting funding," from presumed and paternalistic granting agencies. The entire premise of their organization was to use lending as a globalized policy leverage tool, to issue bad loans to weak governments for political reasons, and then demand policy concessions in exchange for renegotiation terms. These have always been really bad people.<p>It does suggest we need better p2p lending instruments, and really, anything that these organizations think they can do, we should probably be developing alternatives that limit their influence.
Somehow I have a feeling that each passing day, things are getting tighter and tighter and private corporation and government institutions are getting more controlling and totalitarian.
That feeling like slowly being boiled into 1984.
Maybe instead of taking even more of our personal data, they should worry about fixing the algorithm they run on the data they already have. For example, paying off an auto loan shouldn't make your credit score drop 60 points.
Cypherpunks write code.<p>This is part of a larger trend of non-state actors with a huge variety of sometimes very pro-social missions (IMF, anti-child exploitation non-profits) advancing their respective missions through leveraging or targeting other non-state actors' platform control (tech companies, adtech infra) of platforms we totally rely on for day-to-day life (browsers, smart phones, OSs).<p>The connective tissue is the selective analysis, or less generously: magical thinking, of tech's beneficial features for a specific mission while ignoring (or not understanding) what their views for tech-use cause in aggregate.<p>The only counteraction that seems capable of effective reaction to this trend is forcing that "aggregate view." Developers on GitHub re: showing hash collisions for Apple's CSAM tech have recently lead the way in this space. Tools which passively search the web to generate browser histories which have beneficial credit score impact are another option.<p>It's time to return to the mindset cypherpunks created, but expand it from their hyper-focus on privacy: write and socialize tools which politely but directly force tech-lite researchers and non-state actors with powerful missions and influence to acknowledge their blindspots (hopefully), or screw up their products (more likely).
This is bizarre. I don't live in the US and have questions.<p>a) how do they acquire users' web history? Do they purchase it from ISP?<p>b) how do they know what ISP to ask?<p>c) how does the ISP know my web history? Last time I checked, almost all websites I visit use https, so the only thing they can see is domain, not /pathname/<p>d) how does it feel to poke your nose where it doesn't belong?
Lol this kind of shit is ripe for abuse. Not even sure if it would be unethical to find a flaw in the pattern matching just to enhance your credit score.
Hey, they got that system in place already in China! <a href="https://en.wikipedia.org/wiki/Social_Credit_System" rel="nofollow">https://en.wikipedia.org/wiki/Social_Credit_System</a><p>Go to HackerNews, post a dissenting topic, enjoy no travel or credit!<p>Work in a high compliance job where you have to submit financials yearly, no more!
People are very cynical about this but I honestly don't think there's in principle anything wrong with using such data to establish credit-worthiness, because as the article points out many people do not have a stable financial history and this creates a negative cycle.<p>Fact of the matter is if people want access to credit the creditor has a legitimate interest in making an informed decision about whether the individual is reliable to set a correct rate. There is no way around this.<p>The two other alternatives are, we don't give someone access to credit, or we hand out credit without any sort of metrics. The first one doesn't help anyone, the second one doesn't make any financial sense.<p>Consumer data (the article also mentions online shopping history, which makes more sense than 'browser history'), in contrast to institutional banking data is ubiquitous even in poor countries because people now have wide access to phones and services. It would enable a lot of people to get access to credit.
This is daft, but not (just) because of the Orwellian aspect. The problem is that if it was widely implemented, it would immediately stop working.<p>Pretty much everyone here is familiar with Goodhart's Law; I'm surprised the IMF isn't. Use browsing history for credit scores, watch for the immediate proliferation of apps that generate/clean your browser history.
The article is about a post on the IMF's blog by Arnoud Boot, Peter Hoffmann, Luc Laeven, Lev Ratnovski [1], which itself is basically just summarizing a more detailed working paper by the same authors [2].<p>The working paper doesn't really contain any original research (at least on this topic); they cite a single paper by Tobias Berg, Valentin Burg, Ana Gombović, Manju Puri [3]. The IMF working paper/blog post concludes, on the basis of this paper, that a system "powered by artificial intelligence and machine learning" (ugh) can improve credit assessments using features such as "the type of browser and hardware used to access the internet".<p>I feel kind of depressed that this needs to be said, but...<p>1. There is no causal link between user-agent and loan repayment.<p>2. Attaching high-value signals such as credit scores to such easily spoofed data as user-agent and browsing history has some amazingly obvious problems that are never mentioned.<p>The level of technological and statistical incompetence on display here is rather astounding, and it's difficult for me to take any of this seriously even before the ethical questions begin.<p>This is part of an ongoing trend I've noticed: the quality of human capital in financial services seems to be in rapid decline. The cream of the crop was scraped off by huge tech companies on the industry side. On the academic side, all the top students are choosing CS PhD programs instead of econ/finance and top-tier faculty are leaving core econ/business/finance/etc. departments for specialized institutes/departments. And even within finance, already degraded, the under-60 talent that does remain isn't doing stuff like loan origination or credit risk assessment for obvious reasons.<p>I think it's time to start strictly regulating things like credit scores. If not for reasons of privacy/equality, at least merely because the entire industry seems to be incompetent and getting worse.<p>--<p>[1] <a href="https://blogs.imf.org/2020/12/17/what-is-really-new-in-fintech/" rel="nofollow">https://blogs.imf.org/2020/12/17/what-is-really-new-in-finte...</a><p>[2] <a href="https://www.imf.org/en/Publications/WP/Issues/2020/08/07/Financial-Intermediation-and-Technology-Whats-Old-Whats-New-49624" rel="nofollow">https://www.imf.org/en/Publications/WP/Issues/2020/08/07/Fin...</a><p>[3] <a href="https://academic.oup.com/rfs/article/33/7/2845/5568311" rel="nofollow">https://academic.oup.com/rfs/article/33/7/2845/5568311</a>
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>isps giving out "correlation attacks as a service" to "i swear i'm a good actor" companies<p>>IMF recommends using ISP/OS/browsing history metadata for credit reports<p>>salary data is being sent to credit companies<p>I wish i could just only pick ISPs and jobs and houses and lenders and such which don't send information to tracking companies.<p>Sadly working for someone who pays you is illegal unless you report legal names, tax forms, and such to the government... and even making an online purchase without revealing your identity is difficult and questionably legal.<p>How viable it is to rent an apartment or buy a house, without letting others vacuum your personal information?
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The recent Chinese crackdown on tech entities and their use of data hints that the shape of the digital financial landscape depends sensitively on what is deemed acceptable (read: legal) information flow in any jurisdiction.<p>In this sense digital finance will be created by decree rather than as the unavoidable culmimation of some particular "tech innovation".<p>Underneath the huge risks there is always the potential that easier collection and dissemination of information will support a "better" financial system, somehow combining the best rather than the worst of "fin" and "tech".
Is it just me or is this article entirely unreadable due to the in-page scrollable HP ads in the background? The page breaks aren’t calculated correctly so I can’t see half the text. Sigh.
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Haven't they just been talking about changing how credit scores are made and take it out of the hands of private parties and let the government handle it?<p><a href="https://www.usatoday.com/story/money/personalfinance/2021/07/02/congress-credit-score-overhaul-proposal-act/46965135/" rel="nofollow">https://www.usatoday.com/story/money/personalfinance/2021/07...</a>
Can anyone explain to me what credit score is and what it's used for? Does it have to have something to do with credit cards, taking loans or mortgages?<p>(I'm from Europe and I've never borrowed money. I even only use a prepaid credit card, always wondered what benefits a real credit card would even bring.)
And they expect we'll just sit idly by and be surveilled?<p><a href="https://www.activism.net/cypherpunk/manifesto.html" rel="nofollow">https://www.activism.net/cypherpunk/manifesto.html</a>
I’d have thought browser history would be a very poor second to the “hard” metrics. If the credit companies were lacking data then they could probably do worse than look at your family history as far as credit goes.
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Perhaps the long-term expectation is that people will be disappeared or dis-employed for their browsing history. If so, then your browsing history <i>will</i> be a predictor of your ability to repay a loan. A <i>curiously valid</i> predictor.
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lol. wow. nice article.<p>Of course the IMF has it's own goals which are fairly easy to guess. It's no surprise that a 'credit score' is more a way to separate friends from enemies rather than a measure of creditworthiness.<p>It's interesting to think of machine learning let loose on the problem of a persons likelihood to pay back their bills. The uproar about the 'unfairness' of the decisions would be tremendous. No doubt that's already been done to a large extent, but the politics of the era won't allow it so there's bound to be a bit of tension in the system.
This is just yet another push by financial companies to impose on your freedom of speech. Why on earth do people keep pushing for private companies to become political activists?<p>They have already come for individual bank accounts, in the UK for example an activist named 'Tommy Robinson' [1] is not allowed to open a bank account due to his politics [*].<p>"What business of mine is it<p>So long they don’t take the yam<p>From my savouring mouth?"<p>Then they came for Trump, the former president of the United States [3]. Irrespective of your politics, do you believe that he should not be allowed to have money or do business?<p>"What business of mine is it<p>So long they don’t take the yam<p>From my savouring mouth?"<p>Now they come after sex workers on websites like OnlyFans [4], threatening the livelihoods of people doing perfectly legal business. Sure, OnlyFans <i>did</i> need to clean up their act - but we're talking here about the fringe, not the majority. I really also suspect PornHub were also targetted by payment processors not so long ago, but they kept more quiet about it.<p>"What business of mine is it<p>So long they don’t take the yam<p>From my savouring mouth?"<p>"And then one evening<p>As I sat down to eat my yam<p>A knock on the door froze my hungry hand.<p>The jeep was waiting on my bewildered lawn<p>Waiting, waiting in its usual silence."<p>- (Interlaced poem by Niyi Osundare [5])<p>[*] I would suggest to hear his speech at the Oxford Union address [2], rather than a heavily biased Wikipedia entry. The first two references in the Wikipedia article are simply links to news articles calling him far-right - not evidence in the slightest of him having far-right opinions. If you even have the slightest doubt in the news media, please watch the video before casting judgement.<p>[1] <a href="https://en.wikipedia.org/wiki/Tommy_Robinson_%28activist%29" rel="nofollow">https://en.wikipedia.org/wiki/Tommy_Robinson_%28activist%29</a><p>[2] <a href="https://www.youtube.com/watch?v=_YQ94jFg_4A" rel="nofollow">https://www.youtube.com/watch?v=_YQ94jFg_4A</a><p>[3] <a href="https://www.bloomberg.com/news/articles/2021-01-12/more-of-trump-s-banks-cut-ties-as-backlash-grows-over-violence" rel="nofollow">https://www.bloomberg.com/news/articles/2021-01-12/more-of-t...</a><p>[4] <a href="https://edition.cnn.com/2021/08/21/tech/onlyfans-creators-react-sexually-explicit-ban/index.html" rel="nofollow">https://edition.cnn.com/2021/08/21/tech/onlyfans-creators-re...</a><p>[5] <a href="https://en.wikipedia.org/wiki/Not_My_Business" rel="nofollow">https://en.wikipedia.org/wiki/Not_My_Business</a>
Those over at <a href="https://patriots.win" rel="nofollow">https://patriots.win</a> have been claiming this has been the plan for years. A slow move to a CCP style credit system and world government, led by the IMF (control through finances) and WHO (health experts managing governance)<p>Even the vice chair of Berkshire Hathaway has said he wanted a Chinese style system (among many others):<p><a href="https://www.cnn.com/2021/06/30/investing/charlie-munger-china-berkshire-hathaway-warren-buffett/index.html" rel="nofollow">https://www.cnn.com/2021/06/30/investing/charlie-munger-chin...</a><p>It’s been real interesting to watch the conspiracy theories blend and become reality in some cases.<p>Personally, I think it’s more of a lose collection of similar minded people leading to certain conclusions and/or outcomes. But it does feel like an economic victory in civilization ...