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    HKMA Outlines Principles for Consumer Protection in Use of BDAI

    November 05, 2019

    HKMA published a set of guiding principles on consumer protection aspects in respect of the use of big data analytics and artificial intelligence or BDAI. The principles, which are applicable to all authorized institutions, are focused on four major areas: governance and accountability, fairness, transparency and disclosure, and data privacy and protection. HKMA states that the authorized institutions should adopt a risk-based approach commensurate with the risks involved in their big data analytics and artificial intelligence applications when applying these guiding principles.

    HKMA specifies the following guiding principles: 

    • Governance and Accountability—The board and senior management of the authorized institutions should remain accountable for all the big data analytics and artificial intelligence driven decisions and processes. They should ensure the use of appropriate governance, oversight, and accountability framework, appropriate level of explainability of the big data analytics and artificial intelligence models, and proper validation before launch of big data analytics and artificial intelligence applications. The board and management should also focus on ongoing reviews and adherence to the consumer protection principles set out in the Code of Banking Practice.
    • Fairness—The authorized institutions should ensure that big data analytics and artificial intelligence models produce objective, consistent, ethical, and fair outcomes to customers. These outcomes include compliance with the applicable laws, customer access to basic banking services, and robust models of big data analytics and artificial intelligence driven models. 
    • Transparency and Disclosure—The authorized institutions should provide appropriate level of transparency to customers regarding their big data analytics and artificial intelligence applications through proper, accurate, and understandable disclosure. They should provide explanations of the types of data used and how the models affect the big data analytics and artificial intelligence driven decisions, on customer request and where appropriate. 
    • Data Privacy and Protection—The authorized institutions should implement effective protection measures to safeguard customer data. These institutions should ensure compliance with the Personal Data (Privacy) Ordinance and should pay regard to the relevant good practices issued by the Privacy Commissioner for Personal Data.

    Keywords: Asia Pacific, Hong Kong, Banking, Artificial Intelligence, Fintech, Consumer Protection, Big Data, Guidance, HKMA

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