A financial promotion is any communication, made in the course of business, that invites or encourages someone to engage in investment activity, such as taking out a loan, an insurance policy, a pension, an investment or a cryptoasset. Under section 21 of the Financial Services and Markets Act 2000, it must be made or approved by a firm authorised by the Financial Conduct Authority, unless an exemption applies.
How the financial promotion rules work
The definition is wide on purpose. It covers search and social ads, landing pages, emails, comparison pages, videos, podcasts, sponsored posts and influencer content. What makes something a promotion is its effect, not its format: a casual Instagram story recommending a trading app can be one just as much as a television advert.
There are two routes to compliance. An authorised firm can communicate the promotion itself, or an authorised firm can approve a promotion made by someone who is not authorised. Since February 2024, a firm approving promotions for unauthorised businesses has needed specific FCA permission to do so, through what is known as the approver gateway. A set of exemptions, mainly in the Financial Promotion Order 2005, covers certain audiences and situations, such as communications to investment professionals.
Authorised firms must then follow the FCA’s content rules: the promotion must be fair, clear and not misleading, give a balanced view of benefits and risks, and carry the prescribed risk warnings or representative examples for the product type. Consumer credit ads, for instance, need a representative example when they include certain figures or incentives. Since 8 October 2023, cryptoasset promotions to UK consumers have been inside the regime, with their own risk warnings and cooling-off rules for first-time investors.
Breaking section 21 is a criminal offence, and agreements made as a result of an unlawful promotion may be unenforceable.
Why it matters for a UK business
Everyone in the chain can be exposed: the financial firm, the agency writing the ads, the affiliate site and the influencer posting about a product. The FCA has brought criminal charges against finfluencers for promoting unauthorised products, and it routinely asks platforms to remove non-compliant promotions. Ad platforms add their own layer, such as Google’s financial services verification, so a promotion that breaks the rules can also cost you the account.
Social formats cause most of the problems. Character limits, captions cut off behind “more” and short videos all make it harder to show risk warnings with the prominence the rules expect, and the FCA’s view is that each promotion must stand on its own, not rely on information somewhere else.
Common mistakes
- Words like “guaranteed”, “risk-free” or “can’t lose” for products whose value can fall.
- Risk warnings placed below the fold, in small print or behind a “see more” link.
- Influencer posts published without the firm’s compliance approval.
- Editing an approved landing page or ad and not sending the change back for approval.
- Assuming the general CAP Code rules are enough, when FCA rules apply on top for regulated products.
How to act on it
Treat any copy that could encourage someone to take up a financial product as a promotion until compliance says otherwise. Agree an approval workflow with the firm’s compliance team, keep a dated record of each approved version, and send every change, however small, back through it. Put risk warnings where the reader cannot miss them in each format. Brief influencers in writing and approve their content before it goes live. My Google Ads for financial services work is built around that sign-off process.