The rise of financial influencers on TikTok has become a cause for concern among experts, though the Government has declined to take any formal action.
Since early 2021, a number of articles have circulated about problematic or misleading financial advice gaining traction on TikTok.
Financial experts are keen for the government to step in too, particularly because giving financial advice without a license is illegal in Australia.
However, Financial Services Minister Jane Hume told a Stockbrokers and Financial Advisers Association conference last week that, “we have to back Australians to be sensible enough to judge for themselves whether to put their hard-earned money into higher-risk assets.”
“The TikTok influencer spruiking Nokia is not that different to the bloke down at the pub who wants to tell you all about the really great company he just invested in but with a much louder voice.”
She described TikTok ‘fin-fluencers’ as “an inevitable part of the financial ecosystem”, akin to commentators like Scott Pape, aka the Barefoot Investor. It should be noted, though, that Pape does actually have a financial license.
RMIT University senior finance lecturer Angel Zhong criticised Hume’s remarks, telling Business Insider, “the bloke at the pub does not make profits from telling you about the great company he just invested in. On the contrary, social media influencers generate income based on the views of their contents. As such, their motives are different.”
Josh Brown, CEO of Ritholtz Wealth Management told Vox back in January that while he loves “the content”, “people should not invest on the basis of a TikTok video.”
Over the last year, particularly as the pandemic left us all glued to our mobile devices, TikTok has risen as a significant platform for information across every conceivable sector. Ridiculed initially as a hub for viral dances or a spiritual sequel to Vine, the political and cultural influence of TikTok can no longer be overstated.
A number of influencers have built significant followings based on life advice, scientific insights, business advice and through their political commentary. TikTok is now also being used by visual artists and creators as an online portfolio to showcase their work.
Sydney-based Queenie Tan has amassed over 42,000 followers and 200,000 likes for her videos, which provides tips and information on things like superannuation, property and crypto.
@investwithqueenieSuperannuation in Australia 🇦🇺 ##ausfinance ##superannuation ##fintok ##moneytok ##personalfinancetips ##personalfinance♬ original sound – Queenie Tan
TikTok itself is capitalising on the fact that its reach, and the diversity of its content, is mind-bogglingly expansive. A few weeks ago, they announced that they would begin trialling an in-app job recruitment service allowing employers to reach out to Gen Z candidates.
