Hacker News Reader

Comment by staplers | Hacker News Reader

  If they choose, these ultimately government controlled companies can easily make it so you can't buy things anymore, you are not trusted anywhere

America already has that, it's called a credit score and it does this exact thing.

View on HN

Your credit score isn't affected by what you post on Hacker News. Your credit score is affected if you don't pay your bills. You'll find it harder to get credit in the future. I don't see the relation with state sponsored suppression.

Also, you can still buy things with cash. In China they use these apps to pay for things, you can't buy some things with cash.

A lot of companies use publicly posted stuff + friends on facebook to create a credit score though so it does happen in the west. Just not quite in the same way as in China.

Is this true of the US? I see articles from 2015/2016 about credit rating agencies (FICO in particular) looking into "alternate data" to inform scores, including social media stuff, but it looks like FB was fighting that to some extent (more regulatory burden) and the tone is "this is coming" not "this is here".

Source: worked for an online payday lender. There are a lot of commercial APIs from "Consumer Reporting Agencies," providing public information beyond credit rating agencies, that are in use to determine lending decisions. The Wikipedia article on the FCRA[1] has a brief list of these firms and a summary of the laws around data collection and dissemination. IMO the United States needs to both step up enforcement of existing data privacy laws, and more legislation protecting people.

[1] https://en.wikipedia.org/wiki/Fair_Credit_Reporting_Act

I assume, in the case of a payday lender, that that data was mostly used to determine how gullible a potential customer is, and how easy it will be to fuck them over entirely.

Pretty much. One of the metrics optimized for was profitability of repeat business. You want that inflection point where you get as much as possible from the customer while still leaving them solvent and up to date on payments. This is where having all that data was essential - you can build models and determine what the inflection point would be, in terms of payment terms for a specific customer. Traditional payday lenders do not have this data - they would just try to impose the biggest APR and penalties on a customer and rely on collections to recover as much of the "fictitious" (fictitious in that their business plan presupposes they will not be able to collect the majority of it) debt as they could. Collections is expensive and eats into your margins.

Credit score is just a mechanism to help people borrow other peoples money from across different institution in the US. Back in the day, your religious leader might walk down to the bank with you to vouch for your moral character, but that isn't really feasible today. China can literally block you from the market. A bad credit score in the US just lets other free actors see that you are a bad investment.

Reply on news.ycombinator.com