We should never have to give out our social security number to buy a phone

Today T-Mobile’s CEO John Legere announced that 15 million customer records were breached on an Experian server connected with credit checks for device financing. The WSJ points out that records included names, birthdays, and social security numbers — sufficient detail for any hacker to steal user’s identities.

It may be time to ask whether giving out our social security numbers to buy a device makes sense anymore.

We give this sensitive data to banks to get a mortgage.  Maybe we give it to a car dealership to finance a car.  But these are high value purchases.  Given the increasing pace of identity theft in the US, we should be cautious about sharing this information.  For context, see how identity theft has ballooned since the dawn of the Internet:

In this environment, submitting this data to a complete stranger working hourly for a carrier (or to Apple, for that matter) whenever we buy an installment contract starts starts looking like a risky proposition  This is probably the smallest purchase you have financed.  Probably by an order of magnitude.  And yet most Americans are doing it

But why?  We don’t do this for electricity, even though the electricity companies install expensive equipment at our houses.  We don’t do it when we drop our car off at a garage.  There are countless other cases.

The unfortunate reason is that no other option has been tried.  And in fact, the smartphone is so much more like electricity than a car purchase.  It is a critical utility.

Rather than collateralizing your credit score, opening up prime customers to identity theft, and not allowing subprime customers to pay over time, we at PayJoy are suggesting a fundamentally different model.  We qualify people with a government ID, working phone number, and Facebook account, and simply shut off the device if a payment is not made.  Like electricity.

We look forward to partnering with carriers to help them do the same.

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