Big Tech data collection is criticized by the world central bank group

A computer keyboard illuminated by displayed cybercode is seen in this illustration photo taken March 1, 2017. REUTERS/Kacper Pempel/Illustration

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LONDON, May 5 (Reuters) – An article published by the world’s main central banking group, the BIS, has called for individuals and businesses to have more control over the data collected about them by social media and other Big Tech companies and banks. .

The rise of internet-connected cell phones, apps, and other high-tech gadgets over the past few decades has led to an explosion in the personal data that businesses now collect, process, and sell.

The Bank for International Settlements (BIS) paper released on Thursday said that although most countries already have data use laws, most individuals were still unaware of what was at stake or of their rights to their data.

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Authorities should therefore adopt new data governance systems to “level the playing field between data subjects and data controllers,” the document says.

They should require companies to get clearer consent to collect data, better explain how it is used, and make it more easily accessible to those from whom it was collected.

“When data is shared between data providers and data users, the data governance system should specify what data is requested for sharing, how long it will be retained by data users, and who will process it,” indicates the document.

The role of the BIS as a hub for major central banks highlights how widespread the demand for stricter data rules is now.

Current controls differ considerably. While the European Union’s General Data Protection Regulation (GDPR), which came into effect in 2018, is generally considered to be the most comprehensive, it is still seen as presenting problems.

Other parts of the world are much less advanced. The United States, for example, where most Big Tech companies are based, still lacks comprehensive consumer privacy laws, relying instead on a patchwork of state and industry rules.

The document says data subjects also lose out because their information is often locked away in corporate silos or platforms after using an app, website or service.

In turn, companies can then combine this data with other attributes such as income and education to derive insights and predictions, creating “derived data” often considered more valuable.

The young and less affluent also tend to be denied loans due to a lack of credit history, whereas if they had full access to their data online, that could be used instead.

“Young people take time to accumulate tangible collateral and the poor may never acquire enough collateral,” the paper said. “These low-margin, high-risk consumers are not profitable to reach in the traditional system without access to digital data sharing.”

He added that any new governance system should meet the following five standards.

(i) purpose limitation – ensure that the purpose for which data is shared is described in clear and specific terms.

(ii) data minimization – only share the amount of data that is strictly necessary.

(iii) retention restriction – ensure that data is not shared longer than necessary.

(iv) limitation of use – ensure that data is only used for the purpose for which it was shared.

(v) operational resilience – ensuring data is secure.

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Reporting by Marc Jones in London Editing by Matthew Lewis

Our standards: The Thomson Reuters Trust Principles.

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