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Use of Facebook ‘Likes’ in Lending Decisions Raises Concerns

Nov. 3, 2015, 5:00 AM

The increased use of Yelp reviews, Facebook “likes” and other social media interactions to determine a borrower’s creditworthiness has caught the attention of regulators in Washington, amid concerns that the data is too subjective and could result in discriminatory lending patterns if not used properly.

Supporters of the practice, which include the credit reporting giant Experian and online marketplace lenders such as Kabbage, say positive social media interactions can help fill in the gaps on credit histories and help otherwise credit-challenged businesses obtain loans. But consumer advocates are concerned that some borrowers will be left behind if there’s an overreliance ...