B2B Payments

How EU Privacy Concerns Could Stall Big Data’s Rise

After stalled negotiations, the United States and Europe could soon reach a deal addressing the flow of data between the two nations, reports revealed just days ago. The result, a revamped Safe Harbor agreement, could have a huge impact across the B2B sector, particularly as Big Data and cloud-based applications become the industry standard.

Safe Harbor permits the movement of commercial data from the EU by U.S.-based companies if they agree to adhere to EU citizens’ rights over how that data is collected and handled. In place since the early 2000s, the agreement came under fire in 2013, when the NSA’s far-reaching surveillance program made headlines across the globe. In November of that year, the European Commission issued a report that found Safe Harbor to be insufficient in its protection of citizens’ personal data and questioned if the rules as outlined could be effectively enforced. Instead of suspending Safe Harbor, the U.S. and Europe agreed to work toward a mutually beneficial agreement. Nearly 24 months later, a U.S. government official told Reuters that moment is in the very near future.

“It’s very important that we find ways to preserve data flows,” Catherine Novelli, U.S. Under Secretary of State for Economic growth, Energy and the Environment, said at a press event in Brussels last week. “Because so much of this is business to business and because of the cross-investment, we don’t want to be shooting ourselves in the foot by hampering this economic activity.”

Personal privacy concerns may dominate the conversation about Safe Harbor, but business has the most to lose if an agreement isn’t reached or if negotiations stall once again. If the EU decides that private citizens’ information cannot be transmitted across national borders, it could be detrimental to any company that moves data between the U.S. and the EU, from digitally native consumer-facing companies like Twitter — which offers services in Europe but whose servers are all on U.S. soil — to CRM giant SAP, a European-based company whose business is reliant on moving information in to and out of the EU.

Striking a balance between ensuring the privacy of citizens and encouraging growth in a global economy is increasingly important when data is increasingly the most important—and extremely valuable—commodity. Boston Consulting group estimates of EU citizens’ data alone will be worth $1.1 trillion by 2020. The amount of data available will only continue to grow. A recent survey by Cisco expects some 50 million connected devices in the near future and implementing Big Data is at the top of the to-do list for many companies this year.

Cloud-based services are one of the fastest growing technologies created for and in use by B2B companies. Recent research from IDG showed 69 percent of businesses are using at least one cloud-based application. Momentum isn’t slowing, as more businesses plan to move to the cloud within the next 18 months. Businesses are spending big, businesses are increasing their budget for cloud applications and 77 percent of respondents to a survey by Cowen & Company revealed that more of their business processes could be moved to the cloud. Changes to Safe Harbor could hurt the growth of cloud service providers. Many have data centers in multiple countries and constantly move data among them to meet the needs of customers worldwide.

Privacy is a major worry for both the businesses using data and the persons whose data is shared. Without knowing the details of the revised Safe Harbor program it’s difficult to anticipate if the changes will help or hurt those concerns. The wait will be over shortly, when pressed for a timeframe, Novelli told reporters they could expect an agreement on Safe Harbor “very, very soon.”

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New PYMNTS Report: Preventing Financial Crimes Playbook – July 2020 

Call it the great tug-of-war. Fraudsters are teaming up to form elaborate rings that work in sync to launch account takeovers. Chris Tremont, EVP at Radius Bank, tells PYMNTS that financial institutions (FIs) can beat such highly organized fraudsters at their own game. In the July 2020 Preventing Financial Crimes Playbook, Tremont lays out how.

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