What won’t Facebook do?
The latest headline-making move on the part of the social media conglomerate involves banking. According to several sources, Facebook has reached out to several U.S. banks, intending to partner with them to introduce banking features in Messenger. Through Facebook’s chat platform, users could ostensibly connect with their banking institutions, performing tasks such as checking on account balances or receiving alerts for any suspicious behaviour.
But in order to develop such features, Facebook needs banks to share sensitive customer information. And most banks---understandably---are very hesitant about doing so. Facebook has apparently reached out to major banks such as Citigroup, Wells Fargo, JPMorgan Chase, and U.S. Bancorp. In an initial report, it was said that Facebook was requesting customer information from these banks such as card transactions and account balances. However, Facebook has stated that it is not “actively asking financial services companies for financial transaction data.” They’ve also said that information collected would not be intended for advertising use, either.
While reports may be somewhat conflicting, it seems clear that Facebook has some ideas brewing. But what might they entail?
What Does Facebook Want?
In their statement, Facebook declared an intention to improve the customer banking experience through these potential new features. This wouldn’t be the first time Facebook forayed into financial territory. Integrated features with other companies are already in place on Messenger, including PayPal and Mastercard. Partnering with more traditional institutions such as major banks would be a step in a new direction.
This seems to be representative of Facebook’s efforts to turn their platform into something that can be seen as more than just a social site. Integrating various features would be aimed to encourage users to remain on Facebook longer. It’s not surprising that Facebook would be looking for ways to grow---especially after they’ve recently experienced the worst quarter in their history, the first in which their followers decreased.
Executive editor of CNET, Ian Sherr mused, "Facebook is trying to become a one-stop shop for the internet.” Already one of the leading global sites by users and traffic, Facebook is likely looking to continue building its empire by offering additional features that appeal to users. Banks are not likely to invest in efforts where they know their customers are not present. But with Facebook, virtually everyone is using the platform, so perhaps banks would jump at the opportunity.
So far, they have seemed resistant to the proposition.
Are Banks---and Customers Interested?
Reactions to this new feature have generally trended towards the negative. Primarily, banks don’t see much use for it. Facebook’s promises of easy customer service interaction and banking alerts sound good at the outset, but the vast majority of banks already offer this.
There’s also another major stumbling block. Many news outlets have questioned the timing of this move (one reaction was, “that can't be real!"), as it follows closely on the heels of a number of security and privacy concerns that Facebook has faced.
In one recent data scandal, personal Facebook data was misused by Cambridge Analytica. The calamity affected some 87 million users on the platform. Another breaking story revealed that Facebook had shared user data without the consent of those users. This data was provided to hardware manufacturers such as Samsung, Apple, and Amazon.
Given these reputation-tarnishing tales, it’s not surprising that financial institutions would be tentative to involve themselves in partnerships with the potential to compromise customer data. One bank chairman, Claude Davis of the First Financial Bank in Cincinnati said that customers would need to individually approve the use of this data. He said “that information is extremely valuable to the consumer or client,” but he says that even with customer permission, “I don’t think we would be comfortable” sharing it.”
Customers feel similarly, particularly in the wake of these privacy debacles. One survey indicated that 51% of respondents distrust Facebook, with some stating that they did not trust it at all.
Enabling Facebook direct access to banking data seems to take security issues to another level. There’s something alarming about providing banking details---even more than a credit card number or login information. With the possibility for a privacy snafu like those recent ones, it may be unlikely that we’ll be seeing new bank-Messenger integrations in the near future.
But perhaps it will come sooner than we think. With Facebook, anything is possible.