Most of us are on social media these days, the most popular being Facebook, and why shouldn’t we? It’s a great, easy way to keep in contact with our friends and family members who might live hundreds of miles away and all for free. We can share photos and videos, message, video call, and more. However, in the future there might be a darker use of the platform in the not so distant future. There was a patent secured earlier this year that allowed Facebook to determine a user’s creditworthiness by using your friends’ Facebook details and information.
What Is This Patent?
Essentially this patent means that lenders could view the FICO credit score of your friends to judge how credible you are if you were to apply for a loan. The average of all your friends credit rating would then be the figure used to decide if you were granted the loan or not.
Positives Of The Patent
In reality, Facebook are not exactly the first company to use a similar invention to help lenders assess the reliability of someone as an individual and to assess their creditworthiness. To determine them as high-risk or low-risk if you will. In fact it could be very beneficial for alternative lending as a whole, if consumers are seeking a different way to be approved.
Negatives of the Patent
A potential risk however is that predatory lenders could convince potential customers to use this technology if it were to ever become available. Certain individuals could then be liable for a loan due to the average credit rating of all their friends, when in fact they should not be considered in their current situation. This means that they will find themselves in tough financial times and may spend years if not longer paying back this loan with growing interest.
Another important point to take note of is that if lenders do decide to use this feature in the future, and use it as means to measure potential business owners trying to take out a loan, it could be incredibly difficult for them to do so. They could use it to refuse a loan when in fact the individual is very low risk, and thus the whole system seems very unfair.
It is still unclear at the moment however if this patent will ever be able to be used. With the number of cyber attacks and security breaches increasing online, it comes as no surprise along with the points mentioned above that the patent so far has not been very popular. There’s even been mention of the chaos it would cause to Facebook as a whole, with people friending and unfriending people purely based on this patent, or possibly even leaving the platform altogether. Of course there are benefits to be had with this progress in technology and online functionality, but we should always be very careful when it comes to privacy, data protection and other secure details. We already are giving permission for Facebook to sell our details to advertisers. If however this then extends to our friends and their credit rating and other financial information, it is a very grey area indeed.