Facebook pushes link with banks
Facebook Inc. is seeking to forge deeper relationships with banks to share customers’ information so they can access financial products via its Messenger chat application, a business that could boost engagement as growth slows on its social network. The customers would have to opt in, and some big banks appeared to balk at the arrangement, citing security and privacy concerns.
“We haven’t shared any customer information or data with Facebook or any other technology platform,”
Dana Ripley, a spokesman for U.S. Bancorp, said. JPMorgan and Citigroup both appeared to balk at the arrangement, citing similar concerns.
Facebook has for years worked to make Messenger a place for consumers to communicate with businesses, aiming to replace email.
Customers who opt in can already receive some airline boarding passes and receipts from PayPal transactions on Messenger. To do the same with major banks, Facebook has been trying to convince them that the conversations will be secure and customers’ personal data won’t be used in advertising.
“Account linking enables people to receive real-time updates in Facebook Messenger where people can keep track of their transaction data like account balances, receipts, and shipping updates,” Facebook said Monday in a statement. “We’re not using this information beyond enabling these types of experiences — not for advertising or anything else.”
Facebook stock gained 4.4 percent to $185.69 in Monday trading in New York.
Facebook reached out to JPMorgan Chase & Co., Wells Fargo & Co., Citigroup Inc. and U.S. Bancorp over the past year about partnering, The Wall Street Journal reported, citing people familiar with the matter.
JPMorgan declined to comment beyond a statement it provided the Journal, in which the bank said it isn’t sharing customers’ “off-platform transaction data with these platforms, and have had to say no to some things as a result.”
Citigroup spokesman Elizabeth Fogarty said that while the bank regularly has “conversations about potential partnerships, safeguarding the security and privacy of our customers’ data and providing customer choice are paramount in everything we do.”
A spokesman for Wells Fargo declined to comment.
The Journal report said the talks with banks are ongoing. The company has started to feel more urgency to make money from its properties beyond the Facebook social network since saying last month that sales growth will slow and expenses will climb in the next few years — a forecast that sent the stock tumbling 19 percent in one day. The company has also faced questions about its ability to safeguard data after a series of scandals, including a third-party app that mishandled private user information. Some users may be wary of sharing especially sensitive financial details.
Still, Facebook already allows money transfers between friends and e-commerce transactions with businesses through Messenger. It also lets people buy and sell items through Marketplace, its version of Craigslist. And users of Facebook have become more comfortable using their credit cards in the news feed because of a product that enables people to ask their friends to donate to charitable causes.
Four years ago, Facebook recruited then-PayPal Holdings Inc. President David Marcus to run its Messenger platform. Marcus, who in May was reassigned to lead Facebook’s blockchain efforts, had been focused on forging deals with major banks and payment companies to bring financial services to Messenger.
The social media giant partnered with American Express Co. in 2016 to enable customers to see past purchases, check-card balances and learn about benefits and rewards through Messenger. Last year, Wells Fargo said its chatbot on Messenger could enable customers to see how much they spent on certain items in a specific time period or find the location of the nearest ATM.
Facebook’s person-to-person payments capability inside Messenger ranked below similar offerings from Square Inc., Apple Inc. and PayPal in a review from Consumer Reports on Monday. Facebook’s payments product was given lower than average marks on data privacy, which measures data control, collection, retention and deletion. However, Facebook received good marks for “offering detailed terms of service and end-user agreements that explain how they use consumers’ data,” Consumer Reports said.
Facebook has for years worked to make Messenger a place for consumers to communicate with businesses, aiming to replace email.