The Monetary Authority of Singapore (MAS) has become the latest regulator planning to bring restrictions towards marketing financial products in both physical and digital space.

MAS Brings Consultation Papers

On Tuesday, the regulator launched two consultation papers, seeking public feedback until 30 June. One of the papers discusses the proposed rules for marketing financial products in physical spaces, while the other is about digital promotions.

The proposed rules will mandate the disclosure of representatives’ identities and financial institutions in public places. Further, it will limit the prospecting activities of financial institutions only to commercial premises. Also, companies need to provide additional time for customers to make a purchase decision.

While advertising digitally, financial institutions must strengthen their controls to avoid misleading content. Additionally, companies need to tighten practices when appointing third-party service providers for lead generation through online advertisements and collecting potential customers’ contact information.

The regulator is also proposing to limit the gift offers by financial services companies as it would influence customers’ decision-making process.

Safeguarding Public Interests

“We want consumers to receive accurate information, professional advice, and be given sufficient time and space to consider their financial decisions,” said Lim Tuang Lee, the Assistant Managing Director (Capital Markets) at MAS. “The proposals to strengthen responsible prospecting and marketing activities by financial institutions will support these goals, and better protect consumers’ interests.”

The proposed restrictions around marketing came as the Singapore regulator observed advertised financial services that highlighted unsubstantiated high returns without mentioning any specific products. It pointed out that digital advertisements have higher risk issues compared to promotions with traditional physical channels.

Though the MAS did not specify the scope of the new rules, the term ‘financial products’ cover traditional investments and also risky digital assets and derivatives like contracts for differences (CFDs).

“MAS proposes to issue Guidelines on Standards of Conduct for Digital Prospecting and Marketing Activities ('the proposed Guidelines'), to formalize MAS’ supervisory expectations on FIs to put in place safeguards for proper conduct of digital prospecting and marketing activities,” the consultation paper for digital advertisements read. “The safeguards set out in the proposed Guidelines are aimed at addressing conduct risks and issues relating to the use of digital media, especially social media, and are meant to complement the advertisement regulations.”