How does this work? According to the patent’s description, “When an individual applies for a loan, the lender examines the credit ratings of members of the individual’s social network who are connected to the individual through authorized nodes. If the average credit rating of these members is at least a minimum credit score, the lender continues to process the loan application. Otherwise, the loan application is rejected.”
This means if your social network is populated by friends and family members who default on their loan payments or have outstanding debt, chances are just by association, you could have your loan rejected. In some ways this is kind of like LinkedIn where people can see who you are connected with to prove who you really are and if you really do what you claim you do.
At the same time this practice is a bit questionable. After all you could be terrible at repaying loans, but maybe you lucked out by having friends and family members who are the perfect borrowers. Then again we suppose this is only a patent which means there’s no guarantee that Facebook will ever implement it, but what do you guys think of the idea anyway?
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