The German Federal Cartel Office has published a sector inquiry into scoring in online shopping, i.e. the assessment of customers' creditworthiness. Scoring goes largely unnoticed by consumers. The study particularly criticizes the current procedure for credit checks during online shopping and highlights significant consumer rights concerns. The study reveals a lack of transparency for consumers and legally unsafe methods of data processing by online retailers and payment service providers. Possible discrimination in credit checks, for example based on place of residence, is also criticized.
Main findings:
- Transparency deficits: Many consumers are inadequately informed about credit checks. They therefore do not know what data is used to assess their creditworthiness and how this data is processed.
- Legal uncertainties: The legal basis for data processing is not always observed. Many companies do not consistently adhere to the prescribed data protection regulations, which leads to uncertainty among consumers and companies.
Calls for action: It is recommended that consumers are better informed about which data is used for scoring and how the score is calculated. Transparent information should help customers to understand the credit assessment and gain confidence in the procedures. The German Federal Cartel Office also recommends clarifying the legal requirements for credit checks and monitoring compliance more consistently.
Source: German Federal Cartel Office
Further information and report (in German).