The Wall Street Journal reported on Monday that Facebook has been asking Wells Fargo, Citigroup, JP Morgan Chase, and other major banks for their customers’ financial data, including account balances and credit card transactions, in order to provide new tools to its users.
The Journal reported that the social media company had approached the banks with proposals to integrate fraud alerts, account balance notifications, and other features into Messenger, which would then encourage users to spend more time on the app. Facebook told the Journal in the piece that it doesn’t “use purchase data from banks or credit card companies for ads” and that it doesn’t “have special relationships, partnerships, or contracts with banks or credit-card companies to use their customers’ purchase data for ads.”
Though Facebook’s stock rose after the news broke, the piece caused a minor stir on Twitter. The company, which has been warding off criticisms about its data privacy practices, decided to issue further comments pushing back against the Journal. Facebook told CNN, “A recent Wall Street Journal story implies incorrectly that we are actively asking financial services companies for financial transaction data—this is not true. Like many online companies with commerce businesses, we partner with banks and credit card companies to offer services like customer chat or account management.”
Facebook’s statement doesn’t appear to bring to light any new information or clarify anything that wasn’t already in the article. It’s not clear what the distinction would be between “actively asking” and passively asking, or what exactly the company thinks the Journal’s report implies. Facebook seems to be making the point that the data will only be used to enable Messenger tools and not for advertising, though this was already addressed in the Journal’s piece. Facebook added that the tools are opt-in, though this fact was also in the article.
The Journal reported that financial executives are worried about the scope of the information that Facebook is requesting, and that one large bank dropped out of the talks due to privacy concerns. Banks may also hesitate to hand over data because they want to keep customers on their own platforms, instead of third-party ones like Facebook. For example, a group of major banks including Citibank and Wells Fargo have been connecting their apps to a payment service called Zelle in order to compete with Venmo.