Who WON’T be looking at your social network?
Banks and lenders are in on the act. Well, not quite yet, but as soon as enough data can be collected, it will most certainly be crunched and analyzed. Probably in five years, says a credit agency CEO in a Mashable article. Ken Lin of Credit Karma says that the data “could help them determine your potential credit risk and also tailor marketing directly to you.”
What will they be looking for?
- Anything indicative of changes in your financial circumstances. These may include phrases or keywords that you use on social media platforms, such as walkaway, laid off, fired, broke, moving to your parents house, etc. Banks will examine the correlation between these tweets and actual financial behaviors.
- What your social media connections are doing financially. The idea here is that your friends have similar habits and characteristics as you. If one of them tweets about financial hardship, to banks that could mean you might also have trouble later on. UCSD professor James Fowler explores a similar concept in a study about divorce: Being friends with someone who gets divorced makes that person 147% more likely to get divorced themselves.
- Upcoming life changes. Similar to financial changes, the idea here is that banks want to know when you’re approaching major life events, such as getting married or buying a safe car to transport your new child. This information allows banks to tailor certain products and services toward you.
Here’s another case for checking and re-checking your privacy settings. You never know when your “I love bankruptcy” tweet will come back to bite you. Then again, let’s not base all of our life decisions around what someone who runs something called Credit Karma says.
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