The operation of digital financial services (DFS) relies on a mix of consumer personal data and data collected from various sources, such as social media, by fintech platforms. This data is often shared with third parties for services like insurance and collections. Against this backdrop, CUTS International, in collaboration with IIIT Bangalore (IIIT-B), conducted a research study to explore attitudes and concerns regarding multi-party privacy among DFS stakeholders.
 
We conducted an experimental study with 59 IIIT-B students, surveyed over 2200 DFS users (including 460 digital borrowers), consultations with industry representatives, a roundtable discussion with experts, and interviews and observations with 19 DFS users. Additionally, we compared the data collection and sharing practices of digital credit providers with the existing regulatory framework.
 
Key findings include:

• About 25 percent of digital borrowers prefer digital credit for benefits like no-collateral loans. Trust develops gradually, starting with small loans.
• 61 percent of users are neutral about personal data protection, while a quarter shares their data for convenience. Few users take steps to protect their data, citing limited opt-out options.
• Users desire a consent mechanism for co-owned data sharing; however, app designs often lack this feature.
• Location and contact data cause the greatest concern, with 50 per cent of users reporting spam calls after registering for DFS.
• Digital lending guidelines should prioritise consumer protection by introducing privacy metrics to help users identify reliable apps.

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