By Simon Burslem
Let’s put it this way – if you’re one of those people who accepts a friend request from just about anyone, you might want to consider being more selective in your Facebook activity from now on. At least if you have any intention of applying for a loan or mortgage in the future that is. For it has been revealed that the Facebook and Twitter accounts of borrowers could be analysed by banks to decide whether they should give people in Britain a loan or mortgage.
Is this a new low in data and online privacy? Or is it an innovative step by our high street banks? From my point of view the news came as a great surprise, and not a good one at that. This is a dark side of social media that few had anticipated.
Let’s put ourselves in the position of the individual. Why should it matter if their friends have a low credit score? It really is none of the banks’ business to know who your close friends are or who you went to school with 30-years ago. There is no correlation to predict if you are less likely to be able to pay back money because of who your friends are. It is madness.
Secondly, can you imagine people’s reactions if they were to discover their conversations were being monitored on Facebook, especially when you consider the outrage regarding this year’s privacy scandals. For the bank, it’s understandable if someone has lots of friends on Facebook and they say something nice about your brand then you’ll receive extra coverage.
These kinds of personal recommendations can go a long way in convincing someone to switch banks. But as far as credit checking people’s friends on Facebook and monitoring conversations, there’s no clear reason why banks should be acting in this kind of intrusive manner.
Movenbank already checks a potential borrower’s influence, determining how many Facebook friends, Twitter followers or LinkedIn connections they have. Kreditech takes it even further, basing lending decisions on 8,000 datapoints including social media activity, online purchases and even the borrower’s GPS locations. Therefore you better hope no one gave you a one star review on eBay.
And there’s also Lenddo, which describes itself as a ‘trust based lender’ currently operates in the Philippines and Mexico – and uses the online reputations of borrowers as an assessment of their credit worthiness.
Credit tests in the consumers eyes have often seemed trivial and frustrating, but this takes things to a whole new level; a rather uncomfortably intrusive one.
With online data privacy such a hot topic, the event strand of our business has launched Measurefest; a new one day conference exploring the convergence of web analytics, conversion rate optimisation and usability. The inaugural event will be held on October 17th at Logan Hall, located in the Institute of Education near Russell Square, London. For the full list of speakers and details on how to book then please visit: http://www.measurefest.com/ .
There’s no doubt that this story is going to be a hot topic amongst the speakers and delegates.
About the author
Simon Burslem is Marketing Manager at SiteVisibility.