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ACCA Strategic Professional · Strategic Business Leader · Enabling success: disruptive technologies

Calder Bank wants to use big data to offer personalised loan pricing based on customers' social media activity and location history. The board is concerned about the strategic risks. Which risk is the MOST directly linked to the way the data is collected and used?

The most directly linked risk is breach of data protection and privacy expectations, leading to regulatory fines and reputational damage. Using social media and location history for loan pricing involves sensitive personal data and consent issues, whereas storage costs, dashboards and processing speed are technical or operational matters.

  1. AData storage costs rising because of data volume
  2. BBreach of data protection and privacy expectations leading to fines and reputational damageCorrect
  3. CInability to display results in graphical dashboards
  4. DLower velocity of data processing in batch mode

Explanation

Using personal data such as social media activity and location history raises consent, privacy and regulatory issues, with potential fines and loss of trust. Storage cost, dashboard limits and processing speed are operational or technical issues, not risks arising from how personal data is collected and used.

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