The United Arab Emirates has launched the region’s first licensing system for finance influencers, a significant step that wealth managers believe will provide “long overdue accountability” for social media financial content, which has often endangered investors.

The UAE’s Securities and Commodities Authority (SCA) announced the new “finfluencer” license on Wednesday, establishing a regulatory framework for individuals who offer investment analysis and recommendations on digital platforms. This initiative is particularly timely as regulators globally are increasingly concerned about the influence of unqualified social media personalities on public investment decisions.

H.E. Waleed Saeed Al Awadhi, CEO of the SCA, stated that the introduction of the finfluencer license is not just a regulatory action, but a strategic move aimed at redefining the role of regulators in the digital economy. He emphasized that the SCA aims to raise global standards of market integrity, promote transparency, and foster a disciplined financial environment through this initiative.

The regulation will affect anyone with at least 1 000 followers who provides financial recommendations related to regulated products or entities within the UAE. This includes content shared on social media, public seminars, and traditional media appearances.

Daniel George, Head of Business at St James’s Place Middle East, described the license as “a timely and necessary move” that addresses ongoing concerns about unqualified financial advice on social media platforms. He noted that this regulation brings accountability to social media financial content, where unchecked advice has often put investors at risk of scams and misinformation.

George highlighted that the regulation validates the principles upheld by traditional financial firms, such as trust and transparency. He remarked that it “resets the playing field” and underscores the importance of credible financial advisory in a market flooded with unverified information.

Legal experts have pointed out that the UAE’s approach is notable for its broad scope, which is wider than existing frameworks globally. Hala Harb, a Senior Associate at Dubai-based law firm BSA, explained that the regulation applies to all media formats, including offline appearances at public events and seminars.

Unlike other jurisdictions that typically focus on licensed firms, the SCA’s rules apply to anyone with a significant online presence providing financial advice, regardless of their location, as long as they target UAE audiences. Harb noted that the Finfluencer Law sets an important precedent by regulating individual content creators, extending oversight beyond traditional financial institutions.

In a departure from conventional regulatory practices, the SCA has waived all registration, renewal, and legal consultation fees for a three-year period. This strategy is designed to encourage compliance rather than create barriers to entry. However, applicants must still satisfy certain conditions, such as being a certified financial analyst or having a minimum of six months of finance experience.

Harb stated that the relatively low threshold of 1 000 followers shows a proactive regulatory stance, indicating that even smaller content creators must be aware that their financial commentary may now be subject to formal oversight.

The new regulation comes at a time when wealth managers have noticed a growing interest from clients in investment ideas driven by social media. George shared that clients have come into meetings referencing content they’ve seen on platforms like Instagram or TikTok, seeking guidance on whether to pursue these trends.

While this curiosity is welcomed, George stressed the importance of bridging the gap between general content and personalized, regulated advice. He believes the licensing system will introduce accountability during the discovery phase of investment decisions.

St James’s Place Middle East is monitoring the situation closely but has indicated it will not hastily engage with finfluencers. George emphasized that any future collaborations would be with individuals who align with their values of long-term thinking and client outcomes.

This initiative is part of the UAE’s broader strategy to position itself as a leading financial hub in the region and globally. The SCA underscored its commitment to safeguarding market integrity and promoting financial literacy while aligning with international best practices.

George believes that regulatory leadership is essential for attracting high-net-worth individuals and international businesses, stating that such measures communicate the UAE’s seriousness about investor protection.

Despite the positive reception of the framework, concerns remain regarding enforcement, particularly for cross-border content creators. Harb mentioned that enforcing the rules could be challenging due to jurisdictional limits and the difficulties in identifying unregistered individuals.

Nevertheless, she noted that individuals targeting UAE audiences could face actions such as takedown requests for non-compliant content, regardless of their location. The specifics of penalties are not yet clear due to the newness of the regulation.

According to George, the next significant challenge will be enforcement and education, ensuring that both influencers and their audiences understand the implications of the new license.