Millennials in developed nations and citizens of third-world countries may be worlds apart, both literally and figuratively, but both underbanked groups could share a simple solution for their financial woes: a Facebook account.
In developing countries, nations may not have proper identification methods, preventing citizens from accessing adequate banking services and keeping financial institutions at bay. In countries like the U.S., millennials are underbanked for very different reasons, whether they have chosen not to participate in traditional financial institutions, or have simply relied on their parents’ accounts well after adolescence.
And yet despite those differences between millennials and citizens of developing nations, the solution to both of their problems could be through social media, experts say.
Speaking to One World Identity’s Cameron D’Ambrosi on the State of Identity podcast, ID.Me Chief Executive Blake Hall said that in the developed world, millennials, unbanked and socially impoverished are the “most analogous” to people in the developing world. In both cases, those individuals have no or limited records, and are instead going straight to social media.
“Social media becomes the only digital platform that has enough data where you can actually get to know your customers and pull out some attributes that help you understand if they are creditworthy and if that’s a unique identity,” Hall said.
Of course, there are differences. In the modern world, citizens are properly identified from birth and certain information can be verified.
In countries like the U.S., Hall said that financial institutions will want to corroborate social media information with a more traditionally accepted “authoritative record.” Those types of reliable records may not be available in the developing world, however, requiring more dependence on social media profiles for banking services.
Still, the benefits of integrating social media verification into more traditional identification methods are numerous, said Kier Breitenfeld, a senior business consultant with Experian Fraud and Identity Solutions. Speaking to D’Ambrosi on State of Identity, Breitenfeld said that using social media account information to corroborate outside information has a 99-percent-plus accuracy rate, achieving what he called “near-absolute verification of good customers and users.
“Traditional data assets alone really cannot deliver this,” Breitenfeld I think the trick is finding the means to effectively integrate this type of information and data, not only from a verification and risk assessment perspective, but from a compliance perspective as well.”