Social media is fun. Social media is a great way to build brand recognition and customer engagement.
We know this. But there’s more.
Some startups are now leveraging social media as a tool to measure the credit worthiness of their customers. As a business owner – this could be something you might want to consider as you evaluate what credit to offer your customers.
The flip side of this, is that YOU must understand that this concept of “social financial credit scores” is only going to grow. Companies will use YOUR social activity to measure your credit score. This furthers the reason why YOU must use social media and ensure you’re not using it for just fun and games.
The post you make on Facebook today, could come back to haunt you 2 years from now – be careful.
The Wall Street Journal writes, “There could come a time where certain social media could be predictive and we’re looking at that, but it isn’t yet,” said Anthony Sprauve, senior consumer-credit specialist at FICO.
Companies pioneering the practice generally lend to borrowers with troubled credit histories or no bank accounts. They say the use of alternative scoring metrics helps make credit available to people who might otherwise be denied and that they are careful not to violate federal credit laws.”