China issues new rules for online financial marketing
Eight Chinese regulators have jointly issued new administrative measures to regulate online marketing of financial products. The rules aim to curb misleading advertising and monopolistic practices, protecting consumers and investors.
Digital finance, new risks
The issuance of the Administrative Measures for Online Marketing of Financial Products comes as China's digital economy transforms the financial industry, making the internet a key marketing channel.
While this reduces costs and improves service coverage, it has also led to risks such as false advertising, monopolistic practices, and content violating public order.
The Central Committee of the Communist Party of China and the State Council have repeatedly called for strengthening regulation of the platform economy and bringing all financial activities under legal oversight.
The 20th National Congress of the CPC and the 2023 Central Financial Work Conference emphasized harmonizing online and offline regulatory standards for financial activities.
These Measures, formulated by the People's Bank of China (PBOC) and seven other departments, directly address these directives to protect financial consumers and investors.
Regulating qualifications and conduct
The Measures provide comprehensive regulation for online marketing by financial institutions and third-party internet platforms entrusted by them.
Financial institutions must operate within their authorized business scope, while third-party platforms must be lawfully entrusted and not exceed authorization.
The rules strictly prohibit online marketing services or facilitation for illegal financial activities, including illegal fundraising, virtual currency trading, and unauthorized overseas financial services.
Third-party platforms are forbidden from further entrusting business or redirecting users to other third-party marketing platforms.
Furthermore, the Measures consolidate the primary responsibility of financial institutions for marketing content, requiring robust review mechanisms.
Specific rules target algorithm-driven recommendations, live-streaming marketing, forced bundling, harassing marketing, and the misuse of 'financial' terminology.
For instance, loan products cannot use phrases like 'low threshold' or 'lightning-fast disbursement,' and payment tools must be clearly separated from loan products on checkout pages.
A necessary tightening, complex rollout
These comprehensive measures significantly tighten regulatory oversight for China's online financial sector.
Crucial for consumer protection, their broad scope across eight agencies will demand complex implementation from institutions and platforms.
Effective enforcement and rapid industry adaptation are key to realizing market integrity and stability benefits.