The Federal Trade Commission (FTC) is investigating how companies such as Mastercard and JPMorgan Chase utilize AI and personal data to implement services that enable variable pricing based on individual characteristics.
The FTC has issued inquiries to eight firms that provide "surveillance pricing" products, seeking detailed information about the integration of consumer data, including demographics, location, credit history, and online behaviors, in the pricing process.
Chairwoman Lina M. Khan emphasized the importance of transparency, stating, "Firms that harvest Americans’ personal data can put people’s privacy at risk. Now firms could be exploiting this vast trove of personal information to charge people higher prices. Americans deserve to know whether businesses are using detailed consumer data to deploy surveillance pricing, and the FTC’s inquiry will shed light on this shadowy ecosystem of pricing middlemen."
The companies targeted by the FTC include Mastercard, Revionics, Bloomreach, JPMorgan Chase, Task Software, PROS, Accenture, and McKinsey & Co. The inquiries specifically request information on the types of surveillance pricing products and services offered, the data sources used, the clients for these services, and the impact on consumers and pricing.
To learn more about the impact of artificial intelligence in the banking sector, consider attending Finextra’s first NextGenAI conference on November 26, 2024. Register your interest here.