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We recently noted that the data broker industry, in conjunction with social media outlets will become increasingly relied upon as a kind of shadow credit score for judging candidates’ qualifications. Now we see a startup that uses your Facebook profile directly to determine a “credit score” used for microloans.
We hear horror stories of lost employment (or simply not being selected) because of content on social media sites. Now Lenddo, a Hong Kong based startup, is betting money on it.
To determine a prospective applicant’s suitability for a loan, the applicant must submit the logins to three services, starting with Facebook. Users will then be asked for logins to other services like Twitter, Gmail, Yahoo and Windows Live. Three logins are required.
Then Lenddo generates a score based on information gathered, which is then used to determine if you get the loan. What determines the score? Part of that is the “secret sauce”, so details are a bit sketchy, but CEO Jeff Stewart says it is heavily weighted by the information they can gather about the friends you have listed on the qualifying sites. On their website it says, “Lenddo enables you to score your social graph and compare it to your peers. The Lenddo score is a living, breathing score that YOU have control over; you have the ability to increase your score and open yourself up to new opportunities, such as a personal loan, personalized discounts, or other financial products.”
“Social graph” is an interesting term. This is the kind of shadow social media capital we opined would start accruing, and will become more accurate and telling as the data silos about you become more robust over time. Data mining efforts like this will start to move more and more to the mainstream as more of a standard measurement, and more businesses may bet on the data.
This trend also increases the importance of both website security, and your own personal data security management to avoid getting scammed and costing you personally in multiple ways.
They say you’re known by the company you keep. Now that may mean more than you bargained for. If you haven’t locked down your social media profiles, the holiday season downtime might be a good time to take a look. After all, increasingly the solidity (and selectivity) of your e-profile will have more and more direct effect on how you live, maybe even one day when you try to get a loan. Before you try to go out and add the Forbes 400 to your friend list, this venture is only serving the Phillipines market currently. But quantifying social media capital and using it for financial determinations seems like a strong bet for the future. This might be just the tip of the iceberg.
Author Cameron Camp, ESET