The Facebook and Twitter accounts of borrowers could be analysed by banks to decide whether they should give people in Britain a loan or mortgage.

Movenbank, an American online bank, already uses social networking sites to decide whether people are a good risk and said they plan to use a similar system when they come to Britain.

Some overseas lenders already use social media to check applicants’ credit worthiness – looking at their Facebook ‘friends’ to see if any are customers or in debt, as well as conversations held online. This information, based on the assumption that people with a good credit history tend to socialise together, is used to decide if someone is a good or bad risk, how much money banks should lend to them, or if they should refuse them entirely.

Movenbank will launch in Britain at the end of this year, subject to approval from the Financial Services Authority (FSA). It uses data from social networking sites such as Facebook, Twitter and Linkedin to determine how influential potential borrowers are, with those who are more influential having a greater chance of getting better loans.

Brett King, the American banking expert and author who founded Movenbank, told the Sunday Times: “The better the score, the better the rates and fees will be. Someone’s reach and influence is taken into account. If someone has 5,000 friends and posts something good or bad about the service they got at a bank, 5,000 people will see that, which is inevitably good for business.”

Other banks also analyse people’s social networks to determine how good a risk they will be – based on the assumption that those who repay their debts are likely to have friends who have a similar attitude to banking.