Fintech firm Revolut has called on Meta to take greater responsibility for compensating users who fall victim to scams on its social media platforms. The demand comes in response to Meta’s recent data-sharing partnership with UK banks, which Revolut claims is not sufficient to combat the rising tide of online fraud, as reported by CNBC.
Revolut Pushes for Stronger Consumer Protections
Meta’s new partnership with UK banks like NatWest and Metro Bank aims to tackle fraud by sharing customer data that could help prevent scams. While Revolut acknowledges the value of such collaborations, it believes that more comprehensive actions are necessary. The fintech giant is advocating for Meta and other social media platforms to directly compensate scam victims, rather than relying solely on financial institutions to bear the burden.
This call for action coincides with new UK regulations that will soon require banks and payment providers to compensate victims of authorized push payment (APP) fraud. Revolut has expressed support for these measures but insists that social media companies, where many of these fraudulent activities begin, should share in the responsibility.
A Broader Industry Concern
Revolut’s stance reflects a growing sentiment among financial institutions and regulators that tech giants like Meta should play a more active role in preventing and addressing online fraud. Financial services firms argue that social media platforms provide a fertile ground for fraudsters, enabling them to reach vulnerable users through fake ads, phishing schemes, and unauthorized promotions.
While Meta’s data-sharing initiative with UK banks is seen as a positive step, Revolut argues that it falls short of what’s needed to effectively protect consumers. The fintech firm is urging Meta to implement more robust measures, including direct compensation for scam victims and stronger fraud detection systems.
Global Regulatory Attention
The issue of social media scams has gained traction globally, with regulators sounding the alarm over the role of online platforms in facilitating fraudulent activities. Last month, the Cyprus Securities and Exchange Commission (CySEC) launched a social media awareness campaign, highlighting the increasing risk of scams and urging investors to safeguard their personal information.
Similarly, Germany’s financial regulator, BaFin, recently issued warnings about the surge in online investment scams targeting younger investors. BaFin’s survey found that over half of Millennials and Gen Z respondents consider social media a viable alternative to traditional financial advice, underscoring the need for greater oversight and consumer protection in the digital space.
What’s Next for Fraud Prevention?
As regulatory scrutiny intensifies, Revolut’s demands could push social media platforms like Meta to reassess their strategies for combating fraud. With the introduction of stricter UK compensation rules and growing pressure from financial institutions, social media companies may need to adopt a more proactive stance to ensure consumer safety and prevent further erosion of trust in digital platforms.
