People in China are placing increasing importance on the privacy of their personal information.
Ant Financial, an affiliate of e-commerce behemoth Alibaba, has recently landed in hot water with customers in China.
The company offers its users a detailed annual breakdown of their spending, from ranking them among shoppers in their vicinity, to their environmental impact.
The New York Times reported that the company issued an apology to users on 4 January after automatically enrolling those who wanted to see their financial information into its Sesame Credit social credit programme.
The Sesame Credit initiative monitors user behaviour and interpersonal relationships to help reach decisions when it comes to financial lending.
Social credit concerns
Social credit is not a new concept in China. The Communist Party system of renshi dangan is a years-old method of maintaining personal files on people and groups, and Sesame Credit is not the sole firm using social credit.
Many believe that the concept of social credit is a sinister combination of technology and mass behavioural control, using a citizen’s digital trails to judge them against a standard issued by the Chinese government itself.
On 3 January, The Globe and Mail spoke to journalist Liu Hu about social credit schemes. Liu has been banned from buying property, taking out loans and was even refused when he tried to purchase a plane ticket. He said: “What’s really scary is, there’s nothing you can do about it. You can report to no one. You are stuck in the middle of nowhere.”
Liu had been added to ‘The List of Dishonest Persons Subject To Enforcement’, which has close to 7.5m names. Chinese planners want the full system up and running in the next three years.
Tencent also under fire
Alibaba is not the only Chinese company being criticised for apparent breaches of privacy.
In recent days, Geely Holdings chair Li Shufu attracted international attention when he discussed his belief that Tencent’s WeChat messaging app is under constant surveillance.
Tencent said it would never use the chat histories of WeChat users for big-data analytics but few believed it. Activists have spoken of being followed based on information disclosed in WeChat conversations, and people have also been arrested based on chats.
“It has become a default setting for me now to assume that we have no privacy in the face of Alibaba and Tencent,” college student Li Luyao told The New York Times.
Personal privacy is a concept that seems to be increasingly popular among Chinese citizens, which is unusual considering the historically high level of surveillance and government oversight in the country.
The South China Morning Post explained that security concerns in other markets could affect how Chinese firms fare, as individual privacy is of high importance in territories such as the US.
MoneyGram deal quashed
Ant Financial’s acquisition of US-based money transfer service MoneyGram was recently nixed by Washington authorities, citing potential security risks in terms of the Chinese firm’s handling of sensitive consumer data.
Daniel Rosen, a partner at New York’s Rhodium research group and former US government adviser, told Forbes: “We have new concerns arising about what previously might have been seen as purely commercially oriented transactions because of the evolving nature of technology and how it could be used by states.”