However, more transparency is needed about how exactly they work, consumer rights advocates say.
These algorithms can help make life easier, “but they can also lead to bad decisions and discriminate against consumers,” says Klaus Mueller, chief executive of Germany’s federal association of consumer rights centres.
“Algorithms decide not only on which route we drive and what advertising we see on the Internet, but also whether we get a loan from the bank or other services,” he says.
It’s generally unclear on which criteria such decisions are based and how the individual aspects are weighted, according to Mueller. Often the workings of the algorithms are classified as business secrets by the companies that use them.
“Relevant algorithm-based decision-making processes must be able to be controlled by an independent state-authorised institution,” Mueller says.
“We have to preemptively deal with the effects of automated decision-making processes and not only when the first scandals are there,” he says.
A survey carried out by the consumer rights association in Germany found that 80% of those polled want companies to disclose the data and criteria underlying algorithm-based decision-making. — dpa