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Mouthy Money editor Edmund Greaves explores the findings of the latest Young Money report, with the continued presence of finfluencers looming large in the minds of young people and their money.
In the 2023 Young Money report from financial services consultancy MRM, in partnership with Mouthy Money, the biggest revelation was again that young people (18-30-year-olds) are highly trusting of online finfluencers.
Some 71% of them follow finfluencers and trust their money advice on social medial. Very few – just one in 12 – show any signs of scepticism toward the information these so-called experts provide.
The regulator has responded to this growth in the presence of unchecked social media financial information with tough new proposals to ensure finfluencers obey rules around financial promotions and sponsored content.
Young people struggle to discern when they’re seeing independently provided information, with less than one in three (28%) saying sponsorship was clearly communicated all the time.
Nearly all the respondents (93%) said they had done something to act upon the information provided by the social media personality. This is deeply concerning – but it is also offering an intriguing opportunity.
The opportunity here is for responsible financial brands and the sector more broadly (that is, the ones who don’t behave fast and loose) to engage with young people via social media.
All too often financial brands are essentially petrified of engaging through social media at all, let alone through finfluencers. This is down to tough regulation governing financial promotions but is also through some old-school attitudes that need to change fairly rapidly.
A cursory glance at some major UK firms’ social presence illustrates just how little effort is put into their social media outreach.
Chris Tuite, head of consumer finance at MRM, comments: “Misinformation can be costly in more ways than one. There is no doubt that there are more than a fair share of voices on social media channels that are giving young people a bum steer.
“That said, the concept of a ‘finfluencer’ is not necessarily a bad thing. It’s just a question of elevating the voices that should be ‘finfluential’.
“The FCA are making strides on lessening the damaging impact of those that spread misinformation and I’m sure that good work will continue.
“Even so, the challenge now for financial services providers is to ensure their own voices are more influential in the online spaces where young people hang out.
“Financial services providers need coherent strategies for channels like TikTok because, like it or not, a large cohort of their current or future customers are there.
“The challenge now is to get them to hear the right voices to drive better financial outcomes. They need to be braver, bolder and stronger at telling those people the stories that matter to their financial future.”
Edmund Greaves is editor of Mouthy Money. Formerly deputy editor of Moneywise magazine, he has worked in journalism for over a decade in politics, travel and now money.