We all accept the fact that we will see advertisements when we watch television or surf the internet. However, check your next monthly statement from your bank, and you will probably notice retailer advertisements or coupons. The reason? You have been targeted by a new type of promotion called transaction-driven marketing.
With banks fighting historically low interest rates and a severe decline in lending and risk taking revenue, thousands of banks have turned to participation in such programs to generate revenue. The programs allow third-party marketing and data-mining companies to sift through checking and credit-card account records for information on your spending habits, and then design customized advertisements based on your shopping preferences. Banks and marketers claim this private information is “anonymized,” that is, stripped of anything that could identify someone (name, address, account number), but it is impossible to know for sure. As long as your bank shares only anonymized, aggregated data, your privacy might be safe. However, if your bank were to release additional personal information, this would immediately put your identity at risk.
We encourage all consumers to ask their banks about their privacy policies and how consumers’ personal information is used and the companies that have access to it.