DATA PRIVACY CANNOT BE COMPROMISED! ENOUGH SAFETY MEASURES SHOULD BE IN PLACE!

• One of the most commonly apparent developments available to the modern-day world, on the back of the mind-boggling information technology-driven applications and solutions, is the advent of artificial intelligence. Some of the cutting-edge innovations, inventions, and widely used solutions are in the field of data analytics, machine learning, and, of course, large learning models, shaping how AI is becoming increasingly ubiquitous with unimaginable scope and tropes associated with the innovation. However, the critical ingredient for these emerging technologies to work solely rests on the availability of data sourced from different ends. The moot point to ponder over here is whether the data itself is safe from misuse that could lead to a crisis, no less.

PC: LinkedIn

• Despite having safeguards in place, cybercrime and digital offences are on the ascendant. Data breaches are reported quite regularly. And to top it, none of the smart appliances are safe enough from being breached remotely. This part is especially scary. As reported extensively over the years, it’s evident that our smartphones are not really ours when Samsung killed its fire-prone Galaxy Note 7 devices in the US with an update in December 2016. All connected devices are essentially services. Russian troops who stole $5mn worth of John Deere tractors from Ukraine in 2022 learnt this the hard way. So, news that the RBI might allow lenders to disable financed phones when EMIs aren’t paid isn’t alarming technologically. All that needs to be considered is the ethics of it.

PC: Udemy

• Moreover, over the past five years, the purchase of phones and white goods on credit has increased massively – going from 1% in 2020 to 37% last year. Very often, these devices, and phones especially, are sold to people with poor paying capacity. For lenders, the lure is that subprime borrowers can be charged high rates, but with a high risk of default. So, on their own, without regulatory clearances, many lenders were installing kill apps on financed phones until the RBI banned the practice last year. However, it’s rethinking its stand now to balance customer data privacy with lenders’ interests. The question of data privacy is paramount, though. The way these apps have worked so far is highly invasive. Why?

PC: Information Age

• They siphon user data – contacts, photos, messages, location, etc – creating opportunities for misuse long after a loan has been paid off. The chief of one such app maker said their most effective nudging strategy was to change the wallpaper of a phone – 70% of defaulters paid within a week. But as we’ve seen with instant loan apps, data in the wrong hands leaves borrowers vulnerable to blackmail. Two years ago, it was reported that at least 60 Indian borrowers had killed themselves after being blackmailed with morphed photos, etc. That’s why a strict regulation of apps installed by lenders is crucial. And RBI’s intervention will hopefully ensure that. Phone is a misnomer when our SIM is our digital identity, key to social networks and bank accounts.