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CFPB and EC Open Dialogue About Digitization of Finance

Jul 17, 2023 - pymnts.com
Didier Reynders, commissioner for justice and consumer protection of the European Commission, and Rohit Chopra, director of the U.S. Consumer Financial Protection Bureau (CFPB), have initiated an informal dialogue on the implications of the digitalization of financial services. They expressed concerns over the potential increase in consumer exposure to fraud, limited product options, loss of data control, and expensive personalized pricing due to unchecked developments like AI decision-making and digital payments.

The CFPB has received complaints about AI chatbots used by banks, with concerns about inaccurate information and potential violations of consumer data and privacy. Chopra emphasized that companies must understand their AI decision-making processes to ensure adherence to fair lending laws. The dialogue aims to address these issues and keep pace with evolving markets and consumer needs.

Key takeaways:

  • Didier Reynders, commissioner for justice and consumer protection of the European Commission, and Rohit Chopra, director of the U.S. Consumer Financial Protection Bureau (CFPB) have begun an “informal dialogue” on digital financial services.
  • The officials expressed concerns that unchecked digital financial services could increase consumers’ exposure to fraud, limit product options, threaten data control, and lead to more expensive personalized pricing.
  • The CFPB has received complaints from customers about their interactions with banks’ AI chatbots, with concerns about inaccurate information and potential violations of consumer financial protection laws.
  • Rohit Chopra emphasized that companies must understand how their AI is making decisions, and ensure fair lending laws are adhered to when using data.
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