Question: What is the line between acceptable and unacceptable usage of data by banks?

Answer: We’d better figure it out.

Earlier this week, President Barack Obama said in an interview with Charlie Rose that he “wanted to prompt ‘a national conversation’ about the programs and the broader trade-offs between the use of ‘big data’ by government and companies and possible intrusions on privacy.”

Here’s what the president said:

We’re going to have to find ways where the public has an assurance that there are checks and balances in place, that they have enough information about how we operate that they know their phone calls aren’t being listened to, their text messages aren’t being monitored, their e-mails are not being read by some Big Brother somewhere.

Banks, like social media ventures and telecom companies, are privy to wildly private data. To a great degree, my bank knows where I spend my money — by the moment. This is only more so the case as banking moves mobile, which adds my location to the data mix.

Banks should take a long hard look at the accusations levied by Edward J. Snowden at the National Security Agency. Snowden was asked during a Guardian online Q&A earlier this week about how the NSA gets around its legal constrictions. Here’s what he said:

NSA likes to use “domestic” as a weasel word here for a number of reasons. The reality is that due to the FISA Amendments Act and its section 702 authorities, Americans’ communications are collected and viewed on a daily basis on the certification of an analyst rather than a warrant. They excuse this as “incidental” collection, but at the end of the day, someone at NSA still has the content of your communications. Even in the event of “warranted” intercept, it’s important to understand the intelligence community doesn’t always deal with what you would consider a “real” warrant like a police department would have to; the “warrant” is more of a templated form they fill out and send to a reliable judge with a rubber stamp.

How easy it is for banks, like the NSA, to rationalize the usage of their data? Of course, it is not just banks that could do this — Bloomberg has been facing similar charges. But as banking data gets more complex, as “signal data” increasingly finds its way into credit underwriting, for example, how easy is it for banks to cross the line, especially when there isn’t really a clearly defined line to cross.

Who really knows what it means to go too far? As is well known, banks have increasingly moved into the deals space, exemplified by Cardlytics’s service. This deals data puts banks into a whole other realm of data that creeps into a psychographic understanding of what a customer will and won’t do. Can it be argued that a bank should use this data to provide better deals? Yes. Might this data cross the line? Sure. I’ll give you an example. Let’s say a bank takes its deals data one step further to offer a customer’s loved one, say, birthday-present ideas. Those data-driven ideas might put the customer in a bad light (i.e. the referral engine produces “How about a box of chocolates?” even though the customer is a diabetic and has been sneaking sweets). Such a use of data could be both good and bad — it will all depend on the circumstance, which makes blanket usage tricky. Are banks even thinking about such prickly issues? I certainly hope so.

Obama has urged a public debate on these thorny matters, and banking should heed this call. There are so many exciting possibilities in big data, even as there are a multitude of scary risks, too. Finding the right balance will not be easy.