Credit card companies plan to sell your purchase data to advertisers

Evil plot may end up buried in the T&Cs ...

Visa Inc and Mastercard Inc are working on a system for delivering online behavioural adverts to consumers based on what they buy in shops, according to media reports.

The US-based credit card networks have developed "preliminary" plans to place shoppers into groups based on their in-store purchasing history and sell the information to marketing firms that would deliver online behavioural ads, according to report by the Wall Street Journal and another by CNET.

Publishers and advertising networks currently use cookies to track user behaviour on websites in order to target adverts to individuals based on that behaviour.

Mastercard's proposed system involves anonymously grouping consumers into "segments" based on what they have bought and selling the information on to advertisers, according to the CNET report.

Visa's plans involve dividing consumers into groups based on a number of segments, including purchasing history and location, before selling that data on, the CNET report said.

Visa and Mastercard did not respond to requests for a comment.

Iain Connor, advertising expert at Pinsent Masons, the law firm behind Out-Law.com, said that if the scheme was ever introduced in the UK credit card network, it would have had to obtain consumers’ explicit and informed consent in order to sell purchasing history data to marketers.

“Under EU and UK data protection laws, organisations must process personal data, such as consumers’ names and credit card details, fairly and lawfully and collect it for specified, explicit and legitimate purposes,” Connor said.

“If credit card companies want to share UK customers’ purchasing history details with advertisers they will have to explain that they will collect that data from them and explain how it will be used. This could be done via the company’s terms and conditions but the companies would have to obtain customers’ informed and explicit consent in order to sell that information on to third party advertisers," Connor said.

"Whether Visa and Mastercard’s existing data protection notice and terms and conditions would constitute ‘informed’ consent to that happening or whether new terms and conditions would need to be drawn in order to achieve that level of consent remains to be seen,” he said.

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