That’s the headline on my most recent story, with my colleague Justin Scheck.
It was on the front page of Friday’s WSJ.
NEW DELHI–Silicon Valley venture capital is funding a wave of fintech startups in India that use data from borrowers’ cellphones to collect on debts in ways that are illegal in both India and the U.S.
The startups are providing much-needed credit in India, where consumer lending has been limited by a lack of credit scores and by banks that are reluctant to make personal loans. While the newcomers’ tactics are illegal, they are ignored by Indian regulators who want to encourage lending, according to analysts and company insiders. The startups also use personal data to make lending decisions.
It is the latest example of Silicon Valley pushing legal and ethical boundaries in a global race for customers and profit. Lured by the promise of massive populations of people who are just beginning to transact online, tech companies are moving into banking in emerging markets, where cultural norms are complex, regulations are often weak, and many consumers lack credit histories or even official identification.
I also discussed the story on our What’s News podcast. You can listen on Spotify here or search your favorite podcast app for WSJ What’s News.