The share price of Facebook gained 4.4% to $185.69 after reports on Monday suggested that the social media giant has asked big banks in the United States to share detailed financial information about their customers. The company has reportedly sought the information, including card transactions, in order to offer new services to users on Facebook Messenger, reported The Wall Street Journal.
It has approached JP Morgan Chase, Wells Fargo, Citigroup and US Bancorp about hosting several offers on Facebook Messenger. Facebook told AFP that it has also pitched an optional fraud-alert service.
The company, however, clarified that it would not use the bank data for ad-targeting or share it with third parties. “We do not use purchase data from banks or credit card companies for ads,” company spokesperson Elisabeth Diana told The Wall Street Journal. “We also do not have special relationships, partnerships, or contracts with banks or credit-card companies to use their customers’ purchase data for ads.”
The company’s decision comes while it is facing several investigations for its links with political analytics firm Cambridge Analytica. The British firm reportedly accessed data of 87 million Facebook users without their consent.
Besides Facebook, Google and Amazon have also asked banks to share data in order to provide basic banking services on applications such as Google Assistant and Alexa. “Like many online companies, we routinely talk to financial institutions about how we can improve people’s commerce experiences, like enabling better customer service,” said Diana. “An essential part of these efforts is keeping people’s information safe and secure.”
JP Morgan has already pulled out from the talks because of privacy concerns. The investment company’s spokesperson Trish Wexler said the firm had refused to share “our customers’ off-platform transaction data with these platforms, and had to say no to some things as a result”. Citigroup and Wells Fargo refused to comment.
The data breach scandal
In April, Facebook revealed that data of more than five lakh Indian users had been compromised in the Cambrdige Analytica scandal. The breach occurred after 335 Indian Facebook users downloaded an app owned by a company, which later sold the information to the British firm.
The Centre sent notices to Facebook and Cambridge Analytica in March and April. The second one was sent as the responses to the first one were “cryptic”, the government had said. In July, the Centre refused a Right to Information request to share copies of the companies’ responses as they were confidential.