Many firms are working in new computer software capable of gathering, and analyzing data from social networks profiles and connecting this information with other records of people in order to determine the creditworthiness of loan applicants. Banks will ask loan customers for their social media profile names to know their online friends and checking their credit history and financial status as a way to make decision to accept or reject loans requests. This could make some customers pay the price of their online friends bad credit history. For example, if someone with adequate job tries to get a bank loan but most of his social networks friends are struggling financially and not paying their debts on time most likely would be rejected by the bank since the later perceives a potential risk of financial irresponsibility.
On the other hand, banks are trying to utilize such software to locate and attract potential profitable customers. By checking good credit history clients’ friends on social networks, banks market their services to new customers who are perceived to be profitable and have a low risk profiles. Moreover, many Internet websites are developing different models to assess people credit scores. Websites like Credit Report, Privacy Guard, and Free Score 360 are among the top credit score websites. They use algorithms and mathematical equation to create credit score software’s. Financial firms have started developing models in this field since 2010 and it’s expected that by 2015 this technology will be used in the majority of banks and credit reporting companies.
Written by: Abdullah Aljarallah
Source:
Jeffries, Adrianne. "BetaBeat." Betabeat As Banks Start Nosing Around Facebook and Twitter the Wrong Friends Might Just Sink YourCredit Comments. N.p., 13 Dec. 2011. Web. <http://betabeat.com/2011/12/as-banks-start-nosing-around-facebook-and-twitter-the-wrong-friends-might-just-sink-your-credit/>.
I have also heard of this. Companies and even banks are judging you based off of your social networking friends. If it seems that your friends are bad people, you will be judged that way as well. Banks are even checking credit scores of your friends and that will determine if you are given a loan or not, even if you have a good credit score. It's a harsh world. Be careful who you accept onto your social networking sites these days. You never know who's watching.
ReplyDeleteThis makes me wonder about my privacy in social networks and about my virtual life freedom in general. I think such practices by financial institutes well just add more rules about how you behave online and well make people feel less free when they are on the internet. I think this raises a lot of ethical issues about how these financial firms collect their data and also about if they have the right to make decisions based on people around you. I can understand if an employer checks your Facebook page in the hiring process but I still don't think banks should utilize your online activities in order to make their decisions.
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