Promise not Fulfilled: FinTech Data Privacy, and the GDPR

Arbeitspapier

This article analyzes how the General Data Protection Regulation (GDPR) has affected the privacy practices of FinTech firms. We study the content of 308 privacy statements respectively before and after the GDPR became binding. Using textual analysis methods, we find that the readability of the privacy statements has decreased. The texts of privacy statements have become longer and use more standardized language, resulting in worse user comprehension. This calls into question whether the GDPR has achieved its original goal—the protection of natural persons regarding the processing of personal data. We also analyze the content of privacy statements and link it to company- and industry-specific determinants. Before the GDPR became binding, more external investors and a higher legal capital were related to a higher quantity of data processed and more transparency, but not thereafter. Finally, we document mimicking behavior among industry peers with regard to the data processed and transparency.

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• Language: Englisch

References and Relationships

• Bibliographic citation: Series: CESifo Working Paper ; No. 9359

Classification and Topics

• Classification: Wirtschaft ; Regulation and Business Law: General ; Retail and Wholesale Trade; e-Commerce
• Subject: data privacy ; FinTech ; General Data Protection Regulation ; privacy statement ; textual analysis ; financial technology

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Dorfleitner, Gregor ; Hornuf, Lars ; Kreppmeier, Julia
• Event: Veröffentlichung
• (who): Center for Economic Studies and ifo Institute (CESifo)
• (where): Munich
• (when): 2021

Further information

• Handle: http://hdl.handle.net/10419/248904