The problems here are several. As Jeffries notes, banks may become privy to all kinds of information that’s really none of their business, and use that to determine your creditworthiness. There’s also the Faux Friend problem; these models appear to assume your Facebook friends are your actual friends. Some may be, others certainly are not. Why should anyone’s troubled financial past impact mine (or, vice versa), especially a stranger with whom I have shared nothing more than the occasional “Like”?
This is not what we signed up for when we all agreed to engage in this massive social media experiment. First it was employers and college recruiters who began to use our tweets and status updates against us. Then potential mates and cops. Now banks? Who will be next?
Of course, these are just online small fry you can safely avoid ever having to deal with. The big banks would never stoop to such measures. Right? Wrong. Per the Observer article, the companies involved in these schemes claim to have been approached by “the who’s who of banking,” who were keenly interested in their social media parsing algorithms.
Jeffries managed to get credit reporting agency Equifax to respond to her queries; their response was telling:
“Our corporate development professionals are very aware of the opportunities to enhance our proprietary data and partner with companies who add value to the accuracy of our reporting, which helps our customers make better decisions prior to lending.”
I translate that as “we’re looking carefully at this and are prepared to jump in with both feet when the time is right.”
Will you be legally required to give your bank access to your Facebook, Twitter, LinkedIn profiles when you need credit? Probably not. But they won’t be legally required to approve your loan, either.
Got a question about social media? TY4NS blogger Dan Tynan may have the answer (and if not, he’ll make something up). Visit his snarky, occasionally NSFW blog eSarcasm or follow him on Twitter: @tynan_on_tech. For the latest IT news, analysis and how-to’s, follow ITworld on Twitter and Facebook.