Jul 072011
 
 July 7, 2011  Business

Many of the nation’s leading banks and card issuers, including Wells Fargo, Citi, USAA, Sovereign Bank and Discover, are selling information about consumers’ shopping habits — how much they spend, where they shop and what they buy — to retailers.

Retailers are using the data to offer targeted discounts via text, email and online bank statements. Each time a consumer cashes in on one of those deals, the retailer pays the bank a nice commission.

[…]

And, of course, there’s also the issue of privacy. Aite Group estimates that more than 460 million cardholders will be enrolled in the programs. (In most of cases, consumers are automatically enrolled in the merchant incentive programs, but they do have the right to opt out — as required by bank regulations.)

The banks and intermediary companies, like Cartera and Cardlytics, claim that personally identifying information like your name, bank account number and Social Security number aren’t disclosed when they provide your data to a merchant. Instead, an anonymous numeric code is assigned to each customer that only the bank has access to. Because the codes are anonymous and the merchants and intermediary companies don’t have access to a customer’s online account login credentials, the system is just as secure as your online bank account, said Aufseeser.

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