How-to guide: Financial promotions and social media guidance (UK)

Introduction

This guide will assist in-house counsel, private practice lawyers, and risk and compliance professionals advising financial services firms understand the rules that apply to financial promotions on social media to ensure compliance with the requirements.

This guide covers:

1. Financial promotions and social media in context
2. Understanding the law
3. Current requirements
4. Considerations for overseas firms
5. Consumer Duty

This guide can be used in conjunction with the following How-to guides: Overview of the financial promotion regime, Introduction to the UK financial services regulators and Checklists: When does a firm need to be authorised by the FCA or the PRA, Key checks for firms to consider when approving financial promotions and Quick view: The financial promotion regime and marketing of cryptoassets.

Section 1 – Financial promotions and social media in context

1.1 Overview

Financial services firms are increasingly using social media to target investors. This includes channels such as Facebook, Twitter and Instagram. The use of influencers and social media promotions can reach a wide audience very rapidly and influence decision-making when it comes to investing (particularly with younger age groups). It is crucial that investors have access to information that equips them to make effective and informed investment decisions.

Influencers or ‘finfluencers’ are commonly individuals who have a large, engaged social media following who create content to promote products and services. By collaborating with brands, they have the potential to impact investor decisions through their social media platforms. Firms working with finfluencers need to have appropriate oversight and monitoring systems in place to ensure that finfluencers understand their remit. Promoting a regulated financial product or service without approval of a Financial Conduct Authority (FCA) authorised person or providing financial advice if unauthorised risks sanction. Firms remain responsible for the compliance of every promotion they make or cause to be made.

FG24/1 is relevant to:

• authorised persons involved in communicating or approving financial promotions on social media;
• unauthorised persons (including influencers or other marketing affiliates) involved in communicating financial promotions on social media; and
• trade bodies that represent the above groups.

Previous guidance (FG15/4: Social media and customer communications) is now replaced with this new finalised guidance (see section 1.11 - FG24/1). 

Firms need to consider FG24/1 alongside the relevant rules and legislation, and other policies related to advertising and marketing eg, from the Advertising Standards Authority (ASA).

1.2 What is social media?

Social media has evolved since the now retired FCA guidance was published in 2015. That guidance focused on digital websites and applications such as Twitter and Facebook, and image-sharing platforms such as YouTube and Instagram. FG24/1 reflects a changing social media landscape with more financial promotions across streaming platforms, new ways of using social media (eg, by use of memes the FCA note this as a specific example in FG24/1), and communications through ‘private’ or invitation only social media platforms such as Telegram or Discord and public forums like Reddit. The FCA has also identified a substantial increase in financial influencers or ‘fin-fluencers’ on social media promoting financial products, particularly investment and credit products.

1.3 Is social media an appropriate channel for the business?

Marketing promotions via social media is appealing given its wide reach and ability to target a vast global audience; however, there lies the risk. Social media promotions may focus on potentially misleading headlines or fail to present all product information adequately. In GC23/2, the FCA remarked that there was a growing trend in marketing strategies for newer business models such as buy-now-pay later (BNPL) and cryptoassets focusing on social media. See Regulating Buy Now Pay Later (BNPL) and Quick view: The financial promotion regime and marketing of crypotassets.

Customers need to be advised of the potential benefits but also of the potential risks.  In-house legal, compliance and marketing teams need to understand the rules that apply to financial promotions, set up an internal approval and sign-off process as part of their product governance procedure. Product governance plays a crucial role in ensuring that financial products are well-designed and marketed responsibly to the appropriate target market.  Assessing the appropriateness of social media as a marketing channel is part of this process.  Where social media is deemed suitable firms must ensure that all required product disclosures and risk warnings are clearly and prominently included. This will involve considering factors such as the likely audience on social media (given that social media has a much wider target audience) and the complexity of the product or service.

Implementing staff training programmes and engaging with staff (particularly those involved with compliance and marketing) will also educate them about the need to comply with the regulations. Firms need to clearly set the parameters of what conduct is acceptable in terms of social media use, highlight the risks of non-compliance and make it clear what sanctions apply if conduct falls short.

The FCA has noted that financial promotions on debt counselling are unlikely to be suitable for social media (CONC 3.9.2G). The FCA is actively engaging with unauthorised firms who appear to be providing and advertising unauthorised debt advice and debt solutions online, noting a significant trend of aggressive promotions on TikTok and through paid-for Google advertisements.

Posting non-compliant financial promotions not only risks FCA enforcement action but can pose reputational risk to the business (eg, where the firm is subject to press coverage for illegal financial promotions posing risk to vulnerable customers). One recent example is the Freetrade case. In a second supervisory notice issued on 8 February 2022, the FCA upheld its decision to ban the investment app from using social media promotions and to delete all its existing paid-for influencer posts from its channels. The FCA took the view that the promotions were misleading and did not highlight the risks appropriately to protect vulnerable customers. More recently, the FCA has been ramping up efforts to clampdown on finfluencer financial promotions without the appropriate authorisation. In a high-profile case, the FCA announced criminal charges against several well-known influencers in relation to ‘issuing unauthorised communications of financial promotions’ in relation to an unauthorised foreign exchange trading scheme promotion on social media. The scheme related to contracts for difference (CFDs) which are a high-risk investment product.

On 22 October 2024, the FCA noted that 20 social media influencers were being interviewed under caution and that 38 alerts had been issued against social media accounts which may contain unlawful promotions as part of a targeted campaign against illegal financial promotions.

Firms should assess their requirements on a case-by-case basis, build in a culture of compliance and, if in doubt, take legal advice, as the FCA is likely to intervene to issue supervisory notices to firms which do not comply with the social media rules, and where it identifies risk of harm to consumers.

Section 2 – Understanding the law

2.1 The financial promotion restriction

Under section 21 of the Financial Services and Markets Act 2000 (as amended) (FSMA), a ‘financial promotion’ is the communication of an invitation or inducement to engage in investment activity (see chapter 8.7 of the Perimeter Guidance Manual (PERG)) or claims management activity that is communicated in the course of business either in the UK or in a way that could have an effect in the UK. The financial promotion has a broad territorial application. It extends to communications which are capable of having an effect in the UK, even where the communicator is based overseas. This means that a financial promotion communicated by a non-UK entity that can be viewed by UK investors must be compliant with all relevant UK requirements (see PERG 8.8.1G).

The financial promotion restriction does not apply if:

• the promotion is communicated by an authorised person (ie, a firm authorised by the FCA or the Prudential Regulation Authority (PRA));
• the content of the promotion is approved by an appropriate authorised person (who has the appropriate approval from the FCA to do so); or
• an exemption in the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (FPO) applies.

The scope of activities that can be caught is very broad, and spans investments (eg, subscriptions in stocks and shares), mortgages, insurance, banking and consumer credit, as well as claims management activities (eg, seeking out, referrals and identification of claims). The FCA has also extended the financial promotion rules to cryptoassets. See Quick view: The financial promotion regime and marketing of cryptoassets. Financial promotions for investment products should be identifiable as promotions (eg, by labelling them as such), and the financial promotion rules apply to social media in the same way as any other type of communication.

The financial promotion rules are ‘technology neutral’ meaning that they apply equally across all forms of media (including social media) from traditional media like broadcast and print to digital platforms and advertising channels, regardless of the channel used if it includes an invitation or inducement to engage in investment activity.

2.1.1 In course of business

The ‘in course of business’ test requires a commercial interest on the part of the communicator even where the communicator is not making the communication in the context of a direct commercial arrangement. See PERG 8.5. The intention is to exclude genuine non-commercial communications (eg, a chat between friends informally in an online chatroom). The key determinant is the purpose of the communication rather than who is making it. Firms should establish and maintain a clear social media usage policy which is regularly reviewed and communicated to employees (eg, a personal social media account used by an employee could be associated with the firm, and there should be a clear distinction between ‘personal’ and ‘business’ communications). Chapter 4 of FG24/1 provides guidance on applying the business test generally. Additionally, chapters 4.16-4.27 offer detailed clarifications on the criteria used to determine when unauthorised persons or influencers might be considered to be acting ‘in the course of business.’ It includes practical examples to help identify situations which could be caught. If a communication meets the ‘in the course of business’ test and relates to a regulated product or service then the financial promotion restriction applies – see section 2.1.

2.1.2 Issue or approval of financial promotions

Financial promotions are prohibited unless they have been issued or approved by an authorised person (ie, an entity regulated by the PRA or the FCA) or fall within an exemption (as set out in FPO).

Further guidance on the financial promotion restriction and the application of the main exemptions is published in PERG 8. See also How-to guide: Overview of the financial promotion regime. This is a complex area of law and, if in doubt, taking specialised legal advice is recommended.

Social media promotions are particularly popular in the cryptoassets sector. Separate guidance and rules on marketing cryptoassets has been set out by the FCA, including banning ‘refer a friend’ bonuses, and forcing firms to introduce clear risk warnings on adverts and a 24-hour cooling-off period to give first-time investors time to consider their investment decision. Those who communicate crypto-asset-related promotions should ensure they meet expectations set out in the FCA guidance.

Cryptoasset firms registered with the FCA under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLRs) should familiarise themselves with how they can communicate their own cryptoasset promotions by way of a temporary bespoke exemption under the regime. Changes are on the way and once HM Treasury finalises legislation to bring cryptoasset-related activities fully within scope of FSMA this temporary exemption will be removed. Firms will need to use one of the lawful routes to communicate financial promotions. See Quick view: The financial promotion regime and the marketing of cryptoassets and FCA: Cryptoasset firms marketing to UK consumers.

See also final policy and handbook rules which set out more stringent rules on advertising high-risk investments (HRIs) (see also COBS 4.12A, COBS 4.12B and COBS 22), and an ongoing InvestSmart campaign to encourage people to make better informed investment decisions.

As of 7 February 2024, firms approving or intending to approve financial promotions need FCA permission to approve financial promotions for unauthorised persons. This is unless an exemption applies. For guidance on permission to approve (see PERG 8.9) and on the application process (see SUP 6A). Firms must ensure they have the necessary competence and expertise to approve financial promotions relating to the specific investment type for which they are seeking permissions for. They must also have the time and resources to maintain robust compliance policies and processes. See Checklist: Key checks for firms to consider when approving financial promotions. 

2.2 Principles for Business

Authorised firms must comply with the FCA rules governing financial promotions when issuing a financial promotion or when approving a financial promotion on behalf of an unauthorised firm. These are generally to support customer understanding and to be fair, clear and not misleading.

The FCA’s ‘Principles for Business’ (PRIN) in the FCA Handbook place several high-level obligations on authorised firms, some of which are relevant to financial promotions. For example, under PRIN 2, a firm must conduct its business with due skill care and diligence, and under PRIN 3 firms must take reasonable care to organise and control its affairs responsibly and effectively with adequate risk management systems. In addition, PRIN 6 requires firms to pay due regard to the interests of customers and treat them fairly and under PRIN 7 all communications (including financial promotions on social media) must be clear, fair and not misleading. This means that the information provided to investors should enable the customer to understand the product or service and its purpose, and it should detail the benefits but also any relevant risks. Firms should have regard to the target customer segment, and the likely level of financial capability.

The Consumer Duty (see section 5) goes beyond the requirement for communications to be fair, clear and not misleading. Principle 12 and PRIN 2A including the cross-cutting rules, apply to a firm communicating or approving financial promotions which are likely to be received by retail customers. It is a higher standard than principles 6 and 7, and where promotions are made to retail customers the standard that is applied (where the Consumer Duty applies). In-scope firms should consider how the non-Handbook guidance on the Consumer Duty (FG22/5) applies to ensure their communications deliver good outcomes for retail customers, their communications are tailored to the target market, what information recipients need to know and that communications support customer understanding. Staff involved in marketing and compliance should be trained to apply these standards effectively.

2.3 Conduct of business rules

Different sectors have specific financial promotion rules. Firms communicating or approving financial promotions should be aware of the rules in the sourcebooks that are relevant to their business including:

• designated investment business (eg, dealing in investments or arranging): COBS 4 and COBS 22;
• consumer credit: CONC 3;
• general insurance: ICOBS 2;
• mortgages and home finance: MCOB 3A;
• banking: BCOBS 2;
• claims management: CMCOB 2 & CMCOB 3;
• environmental, social and governance: ESG 4;
• general provisions: GEN 4 & GEN 5.

Some sourcebooks set expectations for firms to take account of the Web Content Accessibility Guidelines (WCAG) which set out accessibility standards when designing financial promotions including how risk warnings should be displayed.

Section 3 – Current requirements

The social media landscape has evolved as new products are now available and the way that social media is used for promotions (including the use of influencers) has changed. The financial promotion rules apply regardless of the medium or channel used. FG24/1 sets out the FCA expectations and important points of note however it provides non-exhaustive guidance and firms need to consider their obligations. Examples of good and bad practice are provided throughout to help firms comply.

3.1 Fair, clear and not misleading

It is in the firms’ interests to explain their products and services to enable investors to make effective and well-informed decisions and adverts must be fair, clear and not misleading. Step into the customer’s shoes and consider whether the benefits and risks of the ‘offer’ are being explained clearly to help customer understanding of the product or service. Firms should consider the information needs of their target investors including the layout of the offer (eg, size of text, background, etc) and balance product benefits alongside the relevant risks. The impact of the cost-of-living crisis further increases risk, as vulnerable customers may be more susceptible to exploitation on social media.

Any social media promotion or post that encourages or invites financial activity has the potential to be treated as a financial promotion under the rules and, if so, the FCA expects a financial promotion to be clear on the face of it that it is a financial promotion.

3.2 Standalone compliance

All financial promotions must comply with FCA requirements regardless of their form, content, location or target audience. Each social media post or tweet needs to be assessed individually in its own right. This means that every post, tweet or social media post must be fair, clear and not misleading without relying on other content to make it so.

In an Occasional Paper published in December 2018, the FCA noted that ‘standalone compliance’ creates a consistent approach for firms offering different product types and it ensures that consumers receive a balanced explanation of the benefits or risks of the promoted product or service.

Where character limitations apply, firms can add hyperlinks to signpost a product or service with a link to more comprehensive information eg, on a website, provided that such

signposting language itself does not contain any financial promotion or inducement (ie, something that persuades investors to make a particular investment or buy a particular product) and the link is clear eg, the information is legible and visible to the customer.

When assessing the compliance of a promotion that is viewed via a dynamic medium (eg, Instagram stories), the FCA provides guidance and will consider the promotion as a whole and take a proportionate view based on the number of frames and where information about risk is displayed. To meet FCA expectations regarding prominence, firms should display the key information about risk upon a consumer’s first interaction with the promotion and the warning should be displayed for a sustained period.

The appropriate detail in a financial promotion will depend on several factors such as:

• target audience: consider the knowledge and experience of the intended recipients;
• necessary information: include critical details like costs, risks, benefits – what are the terms and conditions?;
• decision type: when the decision is complex provide more comprehensive information to support consumer understanding eg, provide supporting hyperlinks or separate pathways to access supporting information; and
• cause for confusion: highlight any areas that might cause confusion such as jargon, provide easy to understand examples.

Additional guidance on enhancing the clarity of communications, including through layering is set out in FG22/5. If it is not possible to be stand-alone compliant, then consider the appropriateness of using social media.

3.2.1 Image advertising

Using image advertising may provide a solution to character limitation. An image advertisement is defined in the FCA Handbook as a communication that consists only of one or more of the following: the name of the firm; a logo or other image associated with the firm; a contact point; and a reference to the types of regulated activities provided by the firm, or to its fees and commissions.

Image advertisements may attract exemptions from the rules depending on the type of product and on which sourcebook applies. To make use of this exemption, firms must be careful only to include limited information about the firm and its activities, making sure that the image does not constitute a financial promotion. Where a communication goes beyond the definition of image advertising, it must comply with all relevant financial promotion rules. The approach to image advertising differs based on the product type and the relevant sourcebook. For instance, while image advertising for investments is not subject to the detailed financial promotion rules and guidance in COBS 4, it must still adhere to the overarching principle of being ‘fair, clear and not misleading.’

3.3 Prominence of risk warnings

There are various sector-specific rules across sourcebooks for information that should be included in a ‘prominent’ way to ensure customers are equipped to make timely and informed decisions. Firms should familiarise themselves with the relevant rules for the products and services they offer.

Risk warnings must be suitably prominent in social media promotions (eg, if a risk warning is too small, or the font is hard to read, the promotion will not be compliant with the guidance).

This is particularly relevant to more complex or high-risk investments (HRIs). Customers should be able to effortlessly read and understand the risks involved. See PS22/10 which sets out the financial promotion rules for high-risk investments (HRIs) and firms approving financial promotions. Additional measures apply eg, prescribed risk warnings for HRIs, banning inducements to invest, improving client categorisation and stronger appropriateness assessments. See restrictions in COBS 4.12A, COBS 4.12B and COBS 22. In particular, certain investments are banned from being mass marketed to retail investors, such as non-mainstream pooled investments and speculative illiquid securities (eg, speculative mini-bonds) and unless a firm can ensure that such promotions will not be viewed by retail investors, they should not be promoting these products on social media.

The FCA reminds firms of the requirements on prominence of risk warnings by reference to existing guidance on prominence (which includes examples of good and bad practice).

Where possible information should be displayed without needing click through or any other optional action to view it. Where platforms use ‘truncated text’ (such as ‘see more . . .’), firms must ensure the risk warning is not undermined. If it is not possible to display the full risk warning firms should ensure that they show as much of the warning as is possible to inform customers.

The FCA provides an example of poor practice in relation to platforms such as TikTok which contain all the benefits within the video content, and the relevant risk warnings in the caption below – the FCA notes these promotions lack balance and are therefore likely to be unfair and misleading. The FCA also reminds firms of their obligations under the Consumer Duty to support customer understanding and consider whether communications on social media meet this requirement.

Prescribed risk warnings should be clear to customers on the face of the promotion and used as required. For example, in promotions for restricted mass market investments risk warnings should be in line with COBS 4.12A.36R. Table 1 on page 20 of the guidance sets out how prescribed risk warnings should be applied to certain types of social media channels.

3.4 Sharing and retweeting

Once a post is published, firms have little control of what happens next, or where it gets shared, forwarded or re-tweeted. Typically, the responsibility for a financial promotion lies with the firm that posts it. The guidance makes it clear however that where a third-party shares or forwards communications eg, by retweeting, any breach of the financial promotion rules in the original communication will remain with the original firm that published the financial promotion. It is difficult to fully guard against third-party sharing or forwarding and for those firms with restricted target markets, this is a particular consideration when considering whether social media is an appropriate marketing channel.

The key question is whether the purpose of the social media communication is to obtain business in relation to a regulated activity, does it amount to an invitation or inducement to engage in investment activity, regardless of whether it is issued from a personal account or not. See FCA guidance on communication and relevance to financial promotions in PERG 8.6. Given the speed of distribution and lack of control of where communications will ‘land’ firms should consider whether social media is an appropriate channel to promote products or services with a restricted target market.

3.5 Systems and controls

Firms must have adequate systems and controls in place to sign off digital communications, with evidence of sign-off for marketing and controls coming from an individual who has the appropriate competence and seniority (eg, a senior manager with authority to do so). Consider the financial promotion risk assessments, monitoring of financial promotions (including the date and time they were published), how issues are being raised and escalated. Every firm should have appropriate product governance, sign-off and record-keeping processes in place as part of their risk management framework in line with requirements of the Senior Management Arrangements, Systems and Controls sourcebook (SYSC) – see SYSC 3,4 and 5. Individuals undertaking financial promotions are expected to possess sufficient knowledge of the applicable requirements to apply them appropriately in their role.

Firms should keep records of any relevant communications (see SYSC 9 and other sector-specific sourcebooks) not just to protect customers, but also to protect the firm in the event of a complaint or a claim. Consider processes for monitoring eg, if a particular promotion is updated how are records kept to evidence compliance at each point in time. Firms should not rely on digital media channels to maintain records, as they will not have control of this, so therefore social media posts should be archived and records kept of all materials. Any claims made in the materials should be substantiated and records should be kept of both the published materials and the evidence supporting those claims. The FCA reminds firms that risk management encompasses all risks including legal and reputational risk as well as regulatory risk. 

3.6 Influencers and affiliates

Firms using affiliates, such as influencers to communicate financial promotions on social media should take appropriate steps to ensure the influencer understands the product or service they are promoting and is aware of the relevant regulatory rules. This type of marketing is where the firm agrees to pay commission to a third party (who may well be unauthorised) to promote products or services and to generate business from referrals.  Firms should consider (among other things) whether that affiliate may alter their promotions, communicate unapproved promotions, or might carry on regulated activity in breach of the general prohibition. See How-to guide:  The general prohibition – beware the consequences of breach. 

Firms should pay attention to the influencer’s audience demographics and proactively take responsibility for how their affiliate marketers are communicating financial promotions, particularly if they are likely to have an audience of vulnerable customers. Firms remain responsible for compliance for communications made or caused to be made.       

As noted at sections 1.1 and 1.3, finfluencers promoting financial products or services on behalf of firms via affiliate links or via social media exchanges are at risk of being caught by the financial promotion rules, and the regulator provides some useful examples of where the ‘in course of business’ test might ‘bite’. See FG22/5 which provides guidance on FCA expectations when firms are working with unregulated entities in the distribution chain (especially paragraph 2.22). Firms should also consider their commercial terms in their influencer marketing agreement and whether they provide adequate protection to the firm. 

In a regulatory perspective and priorities for 2025, the FCA has reiterated its concerns about the unlawful promotion of financial services on social media. Firms remain accountable for all promotional activity, including content shared by influencers and affiliates. The FCA’s message to finfluencers is clear: they must act responsibly and only promote financial products where they are authorised to do so or face enforcement action. Recent notable developments reinforce this stance - see FCA international week of action and FCA launch of criminal prosecutions against 9 unlawful finfluencers. The FCA is actively encouraging regulated firms to report illegal content they encounter online and to share any challenges they face when reporting illegal content to tech platforms. 

Firms should be proactive and ensure that they have adequate safeguards, appropriate monitoring and oversight mechanisms in place to ensure that affiliates and influencers are acting responsibly on social media. This includes the ASA expectation for influencers to disclose and prominently label their content as an advertisement (including affiliate links) if they get any form of payment.   

3.7 Other policies of note

Whilst financial promotions are regulated by the FCA, wider advertising online is regulated by (among others) the ASA and firms (and influencers) should also be compliant with requirements in the UK Code of Non-broadcast Advertising and Direct and Promotional Marketing (the CAP code). In addition, a new advice note outlining the rules on affiliate marketing has just been issued by the UK Committee of Advertising Practice (CAP). It explains the circumstances under which different aspects of content will need to be identified as advertising and thus reiterating responsibilities under the CAP code for this type of content. Note too, the FCA and ASA have collaborated to warn finfluencers about the risks involved in promoting financial products and have produced an infographic to help influencers and highlight associated risks.

Note other laws and regulations that may apply (eg, in relation to consumer protection, direct marketing for electronic communications and data protection) are not considered in this guidance.

The regulator warns firms and influencers to be aware of social media platforms’ own policies relating to advertising, which will apply in addition to the FCA’s rules (eg, TikTok has a branded content policy, which has banned the promotion of various financial services products including investments and cryptocurrency).

Online platforms are advised to consider how the financial promotion regime applies to them and to ensure that they are tackling illegal content. This expectation will only increase with the Online Safety Act 2023, requiring search engines and social media sites to have systems and processes to mitigate the risks of posting illegal content. This new regime will be overseen by Ofcom who will work closely with the FCA.

Influencers should also be mindful of article 20 of the Market Abuse Regulation (MAR) if they are producing or providing investment recommendations on social media to ensure information is objectively presented and disclose any conflicts of interest.

Section 4 – Considerations for overseas firms

4.1 Having an effect in the UK

The UK financial promotion regime applies to any communication that ‘is capable of having an effect in the UK’, regardless of where the communicator is based or whether the communication is targeted at UK consumers. The scope of application is broad – see PERG 8.8.1G and overseas communicators may be able in certain circumstances to benefit from an exemption under article 12 of the FPO. Detailed guidance is set out at PERG 8.12.

4.2 Overseas firms

The guidance sets out steps for overseas firms to consider including:

• having a UK authorised firm approve their financial promotions;
• geo-blocking promotions so they cannot be accessed in the UK or by redirecting them to their UK website or mobile app;
• changing the form and content of communications so they do not contain invitations or inducements to engage in investment activity; and
• implementing proper systems and controls to prevent UK customers engaging in the investment activity to which the communication relates and indications that the promotion is intended for persons outside the UK and should not be acted on by UK customers.

4.3 Group companies

The FCA has identified risks where UK consumers are being directed to overseas firms for services when the consumer believes they are dealing with an FCA-regulated firm. Firms need to manage this risk and have appropriate systems and controls in place to protect UK consumers.

Where group entities share social media accounts, they may consider having the UK-authorised entity be responsible for approval of communications through the account. An alternative is to have active UK-specific social media accounts supported by clear and prominent statements directing UK consumers to them.

Section 5 – Consumer Duty

In the context of the Consumer Duty in-scope firms are required to consider how their communications deliver good outcomes for retail customers and promote customer understanding. The Consumer Duty applies to firms communicating financial promotions and to those approving financial promotions on behalf of unauthorised third parties. In-scope firms are advised to consider how their marketing strategies align with these requirements, whether their social media campaigns are compatible with the target audience (particularly where the audience is vulnerable) and complexity of the products being promoted. Firms need to think about how their content will be shared on social media and ensure that their messaging is clear and transparent, even if it is seen by people who were not their original intended audience.

The FCA has explained that compliance with the fair, clear and not misleading requirement will not be enough to ensure compliance. Review of marketing strategies should be undertaken with the Consumer Duty in mind, with regular oversight, monitoring and governance checks to ensure that the communications meet the customer needs and enable the customer to make informed investment decisions. The FCA are taking a proactive approach and misleading promotions that risk consumer harm may well become a focus of their attention.

Firms should also review and consider how non-Handbook guidance on the Consumer Duty (FG22/5) applies to their social media promotions. The FCA has published behavioural research that firms may find helpful when considering how to aid customer understanding, including OP23, OP26 and research notes on HRIs. Additionally, firms should reflect on the relevance of FCA sector - specific reviews to their social media promotion strategy eg, expectations of consumer finance firms in the review of relending by high-cost lenders.

Additional resources

FCA

PS22/10: Strengthening financial promotion rules for high-risk investments and firms approving financial promotions (August 2022)
PS23/6: Financial promotion rules for cryptoassets (June 2023) 
GC23/1: Guidance on cryptoasset financial promotions (June 2023)
GC23/2: Financial promotions on social media (July 2023) 
FG24/1: Finalised guidance on financial promotions on social media (March 2024)

ASA

Online Affiliate Marketing – Advertising Standards Authority (ASA) (March 2023) 
Online Affiliate Marketing – Advertising Standards Authority (ASA) (October 2024)

Related Lexology Pro content

How-to guides:

Overview of the financial promotion regime 
Introduction to the UK financial services regulators
The FCA’s Consumer Duty: putting the needs of customers first

Checklists:

When does a firm need to be authorised by the FCA or the PRA 
Embedding the Consumer Duty: practical considerations 
Key checks for firms to consider when approving financial promotions

Quick views:

The financial promotion regime and marketing of cryptoassets

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