You may not know it, but your credit card issuer makes money by selling data about the purchases made by its cardholders: you and me. WBZ TV, the CBS affiliate in Boston, broadcast an interesting segment Tuesday evening about how banks and credit card issuers make money by selling what they know about their card holders:
"Every time you use your credit card, your bank or credit card company is watching and taking notes. It looks at where you shop, how often you shop, what you’ve purchased..."
I advise consumers to watch the telecast at the WBZ-TV website.
So, what does your credit card company know about you? Think about everything you charged during the past month. During the past 6 months. Groceries. Clothes. Vacation. Personal hygiene. Liquor. Auto repair bill. Junk/fast food. Movies. Bar food and drinks. Doctor copayments. Medicine. Political donations. Cash advances at a casino.
The collection includes the amounts of your purchases and where you made these purchases, too. The collection includes both purchases made online and at brick-and-mortar stores. The collection happens regardless of whether your are a member of a loyalty/rewards program.
Being an informed shopper means knowing all of this. Something to remember the next time you see one of those cute telelvsion ads promoting the convenience of using plastic.
Some consumers see targeted advertisements online when the view and pay their monthly credit card bill. Those targeted ads are based on the prior purchases you made with your debit/credit card,
There are some things I want my credit card company to know well about me. I do want my credit card company to know enough about me to spot fraudulent purchases that are outside my normal purchase area or dollar amounts. So, a certain amount of data collection is good.
If this data collection about card purchases bothers you, experts warn that you can opt-out of some, but not all of the data sharing. Read the privacy statement online at your credit card issuer's website, or the privacy statement enclosed with your last credit card statement. If you want your purchases to remain entirely private, use cash and don't use your debit/credit card.