Dec 03, 2012 Missy Rogers
Big data refers to the enormous amounts of information produced daily that accrues over time. A good portion of this data is produced every day online. Social media content including text, multimedia files and personal information is produced on a massive scale all around the world. Companies' web communications, company information and personalized web content relating to the industry also is collected. Other methods can produce big data, such as police security cameras, credit card transactions, consumer credit data and electronic files that companies hold. Because of the astronomical amount of information collected, innovations are occurring in the tech industry to sort, analyze and correlate this data. New practices will likely need to be adopted among lenders and collectors to implement the usage of big data for advantageous business practices. Innovation
Technology companies around the world are looking into new ways to best sort and process this data. Some are making great innovations in data protection, with high tech monitoring devices to track and fight malware that may compromise company debt collection data. Better sorting options and greater protection from harmful web data allows lenders to implement more effective underwriting practices. Debt collectors might benefit from an increase in data that leads to a higher chance of locating delinquent account holders. Possible legal concerns
Creditors and collectors using big data to inform decision and policy making should be aware that although there is no concise, clear law regarding the usage of big data, best practices should suggest that total usage should fall within the current laws. The United States Fair Trade Commission has been imposing tighter restraints on the credit lending and asset recovery sectors, and it is likely that further regulations on the usage of big data will be on the horizon. Firms that handle sensitive information regarding financial or health history are likely to be the initial targets of the FTC. Therefore, companies with a hand in these industries may be best served to exercise caution and err towards a conservative strategy when it comes to remaining compliant.