The Bundeskartellamt has started an investigation into so-called scoring for online shopping, i.e. to check the solvency of consumers who shop online.
The scoring when ordering goods via online trading is “inconsistent and in many cases not readily comprehensible for consumers,” the Cartel Office justified the step on Thursday.
Lack of transparency and consent could trigger violations of consumer rights.
Mysterious scoring models
"Many consumers are not aware that their creditworthiness is checked with the help of so-called score values when shopping online, especially when it comes to the popular purchase on account," explained Cartel Office President Andreas Mundt.
His authority will investigate “whether and in what form the online retailers provide information about how the checks are carried out and what criteria the credit check is actually based on.”
The office also includes companies that could be relevant for the scoring, such as credit agencies, which provide a key factor for the creditworthiness checks for online retailers by creating score values.
The authority is initially planning preliminary talks with experts and interest groups.
This is followed by written surveys of around 50 selected online dealers and large credit agencies.
The results will be published in a report once the investigation is complete.
Credit agencies store personal data such as name, date of birth, place of birth and address as well as the "credit history" with the number of accounts, loans, mobile phone and leasing contracts, unpaid bills or bankruptcies.
With the help of this data and their own mathematical-statistical procedure (scoring), they estimate the payment behavior of a consumer.
The credit bureaus sell their scores to banks, telephone companies or mail order companies.
They in turn use the scoring value to classify a customer before the contract is concluded - depending on the value, a customer has to pay in advance or is allowed to pay on account, gets a cheap loan or has to pay more interest for it.