Customer Referral Program Design for a Lender: Rewards, Privacy and Fraud
Company: Google
Role: Product Manager
Category: Product Design & Strategy
Difficulty: medium
Interview Round: Other
A lending company wants to grow by having its customers recommend it to people they know. As the product manager, design a referral program for this lender that feels friendly to everyone involved: the customer who refers, the person who is invited, and the lender itself.
```hint Borrowing is personal
Consider what a friend would be comfortable recommending, sharing or being told when the product is a loan rather than a streaming subscription, and let that shape when and how rewards are earned.
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### Clarifying Questions
- Which loans does the company offer (personal loans, mortgages, auto or small-business loans), and does it lend online or through branches?
- What should "friendly" mean here: easy to share, low-pressure for the person invited, private about everyone's finances, or all three?
- Is the aim more funded loans, a cheaper way to acquire borrowers, or better-quality borrowers than paid channels bring in?
- Is the lender allowed to offer cash or a rate discount as a reward under the rules on loan marketing and referral payments where it operates?
### What a Strong Answer Covers
- Why referrals for credit differ from referrals for other products: approval is uncertain, debt is private and rewards can push people toward borrowing.
- A chosen referrer segment and the moment the invitation appears, with a reason.
- A reward design that states who earns what, at which milestone, and what each party learns about the other.
- Protection against referral fraud and fake applicants.
- Success metrics that include the credit quality of referred borrowers, with guardrails on complaints.
### Follow-up Questions
- Referred borrowers convert well but fall behind on payments more often than other borrowers. What would you change?
- How would you tell a referrer their reward is on its way without revealing whether their friend was approved?
- Compliance rules out cash rewards tied to a funded loan for one of your products. What would you offer instead?
Overview: A product design question about creating a referral program for a lending company that feels friendly to referrers, invited friends and the lender. It tests handling uncertain approval and financial privacy, choosing when rewards are earned, preventing referral fraud, and measuring the credit quality of referred borrowers.