Automated and algorithmic decision-making tools have become run-of-the-mill in everything from loan and apartment applications to employment searches and university acceptances. Such tools provide increased efficiency, accuracy, and customer satisfaction for, among many others, banks and financial institutions. These innovations have sped up personal, business, and mortgage loan processes while eliminating many of the inefficiencies of manual practices, including inaccuracies, security risks, and long wait times.
However, as algorithmic loan origination software has developed, the increased reliance on purchased data from third parties and the use of inferred user data has caught the attention of law enforcement for its potential as both a tool for discriminatory practices and a threat to consumer privacy.
