7th August 2014
Ofcom says A ‘millennium generation’ of 14 and 15 year olds are the most technology-savvy in the UK. The communications watchdog claims new research shows that after our teens our digital confidence begins a long decline.The study, among nearly 2,000 adults and 800 children, finds that six year olds claim to have the same understanding of communications technology as 45 year olds. Teens born at the turn of the millennium are unlikely to have known ‘dial-up’ internet and are the first generation to benefit from broadband and digital communications while growing up.
Add to that the fast growing use of tablets by those in their 50s and 60s – a combination of low cost gadgetry, ease of use and visibility of screen – ensures that even the most backward financial services companies need to come forward in social media.
But there is a problem. How can firms ensure their messages have all the regulatory musts when they are limited by space – the average “wealth warning” takes up several 140 character Tweets – and customer attention? The radio solution involving reading out essentials at a garbled and unintelligible 300 words a minute or the TV dodge of flashing up legal wordings for a split second will not work.
Financial watchdog the Financial Conduct Authority is worried because it knows that some firms will take advantage of every loophole their lawyers can find. So it has launched a consultation which is intended to clarify its approach to the supervision of financial promotions in social media. There has been a substantial increase in social media use over the past two years – as customer communication and advertising.
Many financial firms themselves are treading cautiously, however. They know the FCA has greater powers including enhanced fines than its predecessor the FSA. They have confessed to finding it difficult to comply with rules, particularly with character-limited media such as Twitter.
The FCA is now consulting with interested parties. But in the months before the consultation becomes finalised, here’s some pointers for clients and prospective customers.
A substantial danger comes from companies at the fringe – either because they are small or sell non-mainstream assets or products.
Clive Adamson, Director of Supervision at the FCA said:“The FCA sees positive benefits from using social media but there has to be an element of compliance. Primarily, what firms do on social media must ensure customers are at the heart of their business.
“Our overall approach is that financial promotions, whether on social media or traditional media, should be fair, clear and not misleading.”
Those designing personal finance lessons for schools now need to realise that the kids can out-gun their elders in online ability and that by the time their pupils reach adulthood, the world may have changed yet again. So perhaps the teachers need re-educating.