The Financial Conduct Authority (FCA) has released new guidance aimed at clarifying the expectations for firms and influencers who promote financial services through various social media platforms, including memes, reels, and gaming streams. While the updated guidance doesn’t introduce new obligations, it provides clarity on the FCA’s expectations and how firms can comply with existing regulations, emphasizing the importance of keeping advertisements lawful.
Financial Promotions must be fair, clear, and not misleading, ensuring consumers can choose financial services products with confidence. The regulator warns that it will take action against those failing promoting financial products compliantly. FCA intervention in financial promotions saw over 10,000 financial adverts amended or withdrawn in 2023.
With the ever-evolving landscape of social media, including new platforms and influencer personas, the FCA updated its guidance to address potential consumer harm. The guidance emphasises the need for clear, balanced financial promotions that provide key information and align with the wider obligation to deliver good outcomes for customers under the Consumer Duty.
Key points from the guidance include ensuring financial promotions are standalone compliant, displaying specific information prominently, and considering the appropriateness of platforms with character or space limitations. Firms working with affiliate marketers, such as influencers, are expected to take proactive responsibility for how affiliates communicate financial promotions.
Influencers are reminded to consider whether they are suitable to promote a product or service and to adhere to relevant rules and standards. The updated guidance reflects the FCA’s commitment to adaptability in regulation, aiming to ensure the effective implementation of the Consumer Duty amidst rapid technological advancements in social media.
Given the speed of technological evolution, the FCA has acknowledged the challenges it faces in ensuring its guidance remains effective and relevant. The regulator strives to maintain its supervisory work and guidance in line with the dynamic nature of the sector.
