While financial influencers, or ‘finfluencers,’ can help raise awareness about money-related matters, their rise has also highlighted the risks of unregulated advice.
In the UK, over one in four people turn to social media platforms, messaging apps, or online forums for investment tips, according to research1. A fifth of this group cite ‘free access to financial experts’ as a key reason for seeking advice online, while a quarter appreciate the speed and convenience of these platforms.
The risks of online advice
Turning to social media for financial advice comes with significant risks, particularly as many users do not verify the credibility of the advice they receive. Specifically, over half of UK adults who rely on social media for investment guidance admit they don’t check the legitimacy of ‘finfluencers’ and their advice. Young people in particular are more prone to falling victim to scams which are often endorsed by unreliable influencers.
Actions against ‘finfluencers’
The Financial Conduct Authority (FCA) has taken steps to combat this by issuing 38 warnings about social media accounts promoting potentially illegal financial products. In many instances, these influencers are not FCA-authorised and don’t have the qualifications to give financial advice.
Social media has its advantages, but it’s essential to make sure that financial advice comes from a reliable and accredited professional to avoid scams and unsuitable recommendations.
1Barclays, 2024
It is important to take professional advice before making any decision relating to your personal finances. Information within this article is based on our current understanding and can be subject to change without notice and the accuracy and completeness of the information cannot be guaranteed. It does not provide individual tailored investment advice and is for guidance only. Some rules may vary in different parts of the UK.