South Africa’s Financial Sector Conduct Authority (FSCA) is preparing to regulate social media financial influencers like authorized financial advisors. This development follows the FSCA’s recently published requirements for financial education initiatives, which aim to ensure that such content remains objective and free from product promotion, per Daily Investor.

“The FSCA has seen evidence of ‘finfluencers’ conveying misinformation and perpetuating scams through social media, which presents a clear risk to the public,” the authority stated in its 2024 Regulatory Actions report.

Gerhard van Deventer, FSCA’s Divisional Executive of Enforcement, clarified that “any person that provides financial advice with reference to a financial product as defined requires authorization by the FSCA,” adding that unauthorized advice constitutes a contravention of the FAIS Act.

The regulatory tightening comes in light of recent research showing South Africans spend 56.80% of their waking hours on screens—the highest proportion globally. Additionally, South Africans devote 22.26% of their daily waking time to social media platforms, making them particularly susceptible to financial advice encountered online.

The FSCA will continue monitoring influencer activity and investigating complaints, and enforcement sanctions will be considered in appropriate cases.

Industry Response

Financial professionals have welcomed the development. Renee Eagar, Head of Brenthurst Wealth Claremont, noted that ‘finfluencers’ are “not the same as qualified financial planners and do not have to adhere to the same regulations or accountability measures.”

She highlighted several risks of social media financial advice, including promoting unqualified voices, sophisticated financial scams, and undisclosed paid promotions.

This regulatory shift comes after the Interactive Advertising Bureau South Africa launched the Content Creator Charter in October 2024. The Charter establishes guidelines for ethical partnerships between marketers and content creators and emphasizes transparency, disclosure of brand partnerships, and adherence to Advertising Regulatory Board guidelines.