In an effort to "deepen user engagement" on the platform, Facebook is pitching a deal with major US Banks to partner up and allow Facebook to access it's users financial info. Facebook especially wants to know where you're shopping and what you're buying there.
Facebook increasingly wants to be a platform where people buy and sell goods and services, besides connecting with friends. The company over the past year asked JPMorgan Chase & Co., Wells Fargo & Co., Citigroup Inc. and U.S. Bancorp to discuss potential offerings it could host for bank customers on Facebook Messenger, said people familiar with the matter. (Source)
The upside for banks is that customers get to do business through Facebook, a huge market where billions of users go. Banks have concerns about the data, given the recent fiasco with data privacy issues.
Facebook has told banks that the additional customer information could be used to offer services that might entice users to spend more time on Messenger, a person familiar with the discussions said. The company is trying to deepen user engagement: Investors shaved more than $120 billion from its market value in one day last month after it said its growth is starting to slow.Facebook said it wouldn’t use the bank data for ad-targeting purposes or share it with third parties.
“We don’t use purchase data from banks or credit card companies for ads,” said spokeswoman Elisabeth Diana. “We also don’t have special relationships, partnerships, or contracts with banks or credit-card companies to use their customers’ purchase data for ads.” (Source)
Facebook says it won't use the data to target ads onto users or share it with third parties, but come on, this is the dream for advertisers. This is why they have point cards in supermarkets. They sell your purchase data so that businesses, advertisers and marketers know what products are selling well in certain areas, at what time of day, etc.
Facebook could get even better at targeting users with ads to buy things on the platform. Advertising would have an even better chance at making money, and this would attract even more ad revenue for Facebook. It would also help Facebook recover in value amidst it's historic $120 billion drop in share value last month. But, so far they deny this angle.
Banks are cautious despite these assurances. One bank reportedly backed out of the talks, despite Facebook's promise not to use the data for ad-targeting. But then, why do they want to get the info for where people are shopping and what they buy? Google and Amazon tried to get banks to join their online platforms and engage in data-sharing agreements too. Banks are keeping their distance (for the time being) from letting non-banking apps and services have access to their users information.
Despite this deal not being sealed, some see it as potential for a market recovery. Facebook's value has sharply risen 2.5% in response yesterday. The value seems to have fallen back down again today though. A lot seems to hinge on this new deal for Facebook.
Thank you for your time and attention. Peace.
References:
- Facebook to banks: give us our users' financial data and we'll let them bank with Facebook
- Facebook Asking Major US Banks To Share Users' Financial Data
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