75% of consumers unlikely to allow access to their social media to assess their suitability for financial products
As financial companies increasingly look to use social media to assess an individual’s suitability for products such as mortgages, loans and credit cards, research from business insights expert Equifax reveals that 75% of consumers are unlikely to allow them access to this data.
The online survey, conducted by YouGov, found that 76% of consumers are against financial companies using the information they post on sites such as Twitter, Facebook, Instagram and LinkedIn to assess their application for a financial product. Over half (52%) said it would make them angry.
Despite consumers’ objections to the use of this information, only 35% of respondents would go as far as changing what they post online if it was being used to verify their identity or spending habits.
Paul Birks, Director of Decision Solutions at Equifax, says: “While we are fast becoming social media ‘addicts’, the survey results show that people are against financial companies using social media to assess their suitability for products. This raises challenges as using this data can be a huge benefit for both companies and consumers, for example in helping fight fraud, and evaluating what people can afford to borrow.
“With fraud on the rise, companies are turning to social media as a useful tool to verify an applicant’s identity. The number of contacts and length of time an online profile has been established is a useful way to help judge whether an application is genuine or from a fraudster. A well-established, active social media presence is very hard to fake.
“If companies go down this route they have to be transparent and educate consumers on how social media information could be used; consumers also need reassurance that, as with any personal data, privacy will be respected. Using social media information to assess an application could be particularly useful for people who don’t have a traditional borrowing history and therefore may have a ‘thin file’, such as a young person applying for their first loan. Companies have a moral and regulatory obligation to lend responsibly, and should investigate all the tools available to help ensure this happens.”