First they hiked up debit card fees and now some financial institutions are looking to make a quick buck by selling marketers information about where and when you spend your money.
Both Visa and MasterCard are revving up plans to start selling stats taken from data on credit card spending to help companies target their advertising, Emily Steel reports in the Wall Street Journal.
This means gizmo lovers who spend their payday racking up the latest at Amazon or Best Buy shouldn’t be surprised when coupons and deal alerts for electronics start popping up in their inbox. Ditto for travel hounds who love to rack up frequent flier miles by swiping airline-affiliated credit cards every chance they get.
According to Daily Finance, banks will probably get on board, too, by launching merchant-reward programs. But instead of targeted ads, the banks will push coupons and deal alerts directly through the consumer’s checking account.
By funelling anonymous information gleaned from credit and debit card transactions, financial institutions could offer a proverbial gold mine to marketers, who make it their priority to figure out what makes consumers tick.
Using the stats, companies can then turn around and pump targeted ads to your email or push deals and coupons for retailers based on your interests.
This is all dandy for financial institutions, especially since they’re still hurting from newly imposed limits on fees they can charge retailers. But for consumers still getting used to the idea of advertisers tracking their behaviour on the Web, the thought of yet another probe into their spending habits could seem daunting.
The truth is this probably won’t mean any drastic breach of your personal security at all. All of your account information will remain private, and the only thing banks and credit card companies will be selling is insight into where your cash flow is going.
The technology is still evolving, WSJ says, but the ideal result would be that companies could track whether advertisements linked to spending habits could actually influence people to open their wallets.
But the choice would ultimately be yours, as MasterCard and Visa both plan to give customers the opportunity to opt out of such programs.
The only real danger I see is the pressure this would put on consumers to spend even more on stuff they probably don’t need.
I’ve already cut myself off from all those daily coupon mailing lists from tempting retailers like the Gap and Sephora. The last thing I need is my own bank to start pumping me tantalising offers for discounts on those fur-lined boots I’ve been lusting over, but have absolutely no business owning.
The bottom line is both MasterCard and Visa are still in the process of figuring out this system for themselves. But chances are that once two of the largest credit networks on the market start to move a certain direction, the rest of the herd is sure to flock right behind.
It’s up to you whether or not you’ll be among them.
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