Duitsland niet blij met online kredietwaardigheidsonderzoek (en)

Berlin - Germany is known for being particularly sensitive on data privacy issues.

Google Street View - a service combining maps with actual photographs of streets and buildings - had to put blurred houses in its German service in order to be able to run at all in the country. Data protection authorities also took Facebook to court for obliging people to reveal their real names (Facebook won).

But beyond the headline-grabbing news about Google and Facebook, Germans are being surprisingly tolerant about a new range of data businesses which can limit their options when it comes to renting a new flat, getting a credit card or shopping online.

A myriad of companies have been set up in the past few years, specialising in solvency profiles of individuals.

According to the federal data protection authority, "their exact number is not known."

The largest of them is Schufa - a firm pooling data from all banks on credit cards, mortgages and loans which combines them with the payment record for utilities bills, parking or speeding tickets, as well as bankruptcy procedures.

When renting a flat, German landlords always ask your Schufa "score" - an aggregated number based on the payment record and solvency of each person.

But apart from Schufa, which holds data on 65 million people in Germany, there are dozens of smaller firms who charge less when evaluating people's creditworthiness of people, making them more attractive to online retailers and smaller banks.

One of their methods is "geoscoring" - if the firm has no data on a certain person, it evaluates their likelihood to default based on where he or she lives.

If it is a nice neighbourhood where people pay their bills on time, the report is positive. If it is an area where neighbours have a bad payment record, the same is assumed for the person at stake.

German public broadcaster ZDF has documented several cases where people were denied credit cards or certain products they wanted to buy online because they were wrongly deemed as living in the "wrong" neighbourhood.

The credit score companies, upon request, acknowledged they had no data other than their address, name and age.

For his part, Germany's data protection chief Peter Schaar said in a press conference on Wednesday that credit reports based solely on geoscoring have in fact been banned since 2011.

"But there is a way around this ban. If these firms add the age and the name to their calculations, then geoscoring is allowed," he noted.

"We ask for new legislation to fill this loophole, because it creates clear discrimination," he added.

Based on the name and age alone, the credit-scoring companies try to guess if someone is still a student without much money or a retired person, who is likely to pay everything on time.

The data protection chief said the centre-right government led by Angela Merkel i has failed to deliver on its promises and that the only hope is for a new EU law on data protection to impose restrictions on the practice.

But he warned that "even if it's adopted, it won't be put in place until 2015. In the age of the Internet, that is a very long time."

Meanwhile, Jan Philipp Albrecht i, a German Green member of the European Parliament, told this website that negotiations between the parliament and governments on the new EU data protection law are likely to start this autumn.

"It will be exactly about issues like credit scores and profiling - people should know who is gathering data on them and to what aim. And they should have the possibility to see and correct the data," he said.

"The problem in Germany is not so much that somebody buys those credit reports, but that the government has allowed these firms to spy around and then to sell that data," he added.