Marketing experts working with companies in the financial sector face a challenge—advertising for financial products is strictly regulated by the Lithuanian Central Bank's Financial Services Advertising Guidelines. These guidelines apply to banks, investment management and insurance companies, crowdfunding platforms, and other financial market participants supervised by the Lithuanian Central Bank.
The purpose of these guidelines is to protect consumers from potentially misleading information and to ensure that the advertising of financial products and services is fair, transparent, and comprehensible to consumers.
The guidelines outline the main requirements and restrictions:
1. Clarity and honesty in advertising content:
The advertisement must be accurate, clear, and not misleading. It is prohibited to provide false or incomplete information that could mislead consumers about the nature, risks, or benefits of financial products or services.
The advertisement must reflect the actual conditions of the offered products and services. It is not allowed to emphasize only the positive aspects while ignoring potential risks.
For example, an advertisement about an investment fund cannot highlight only its historical returns while ignoring market fluctuations and associated risks.
2. Disclosure of risks:
Advertisements related to investment products must clearly inform consumers about the associated risks. If potential profits are mentioned in the advertisement, it must be stated that investments can also result in losses.
If the advertisement relies on forecasts or past results, it is mandatory to clearly indicate that past performance does not guarantee future results.
For instance, if a pension fund is advertised, it is necessary to include a warning that the value of pension funds can fluctuate and there is a risk that the invested amount may decrease.
3. Restrictions on advertising promises:
It is prohibited to promise or claim that investments are “safe” or “guaranteed” if this does not reflect reality.
Advertising slogans must be substantiated and should not create misleading expectations about the attractiveness or benefits of products or services.
For example, an advertisement claiming that a particular investment product is “guaranteed” may be misleading if there is indeed a risk of losing part or all of the invested capital. Such a claim should be clarified, for instance, to “certain capital guaranteed under specified conditions.”
Another example is an advertisement that states, “by investing with us, you will surely earn,” which should be accompanied by a warning that all investment products carry inherent risks and are not guaranteed.
4. Information tailored to the target audience:
The advertisement must be adapted to the intended audience, taking into account their financial knowledge and experience. Information for non-professional investors must be presented in a simple and understandable form.
It is prohibited to advertise financial products or services to vulnerable groups if they are not capable of understanding the associated risks.
For example, if a loan targeted at seniors is advertised, it is essential to ensure that the communication is simple and clearly understandable, considering the potentially limited financial literacy of this audience.
5. Disclosure of contract terms and costs:
The advertisement must clearly indicate all possible fees, commissions, or other associated costs. If this is not clearly stated, the advertisement may be considered misleading.
If the advertisement is based on contractual obligations, such as fixed terms or contractual commitments, these aspects must be clearly emphasized in the advertisement.
For example, an advertisement for a credit card with “0% interest for the first 6 months” should also clearly indicate what interest rate will apply after this period and what other fees are associated with the card.
Another example—if a life insurance service is advertised, it is necessary to clearly state what the administration fees are and how they can affect the return.
6. Comparisons and statements about competitors:
Comparisons with competitors’ products must be based on objective criteria and not contain misleading statements. Advertisements cannot claim that a particular product or service is better than competitors unless this is substantiated by objective data.
It is prohibited to unethically or falsely criticize competitors or their products.
For example, an insurance company advertising its health insurance product as “better than competitors” must provide a clear comparison based on specific criteria, such as insurance payout conditions or premium amounts.
7. Advertising format and presentation:
The format and design of the advertisement must be clearly recognizable as advertising. It is prohibited to mislead consumers by presenting an advertisement as editorial content.
If third-party recommendations or evaluations are used in the advertisement, their independence must be clearly indicated.
For example, if a bank uses online advertising, the advertisement must be clearly recognizable as promotional content by using labels like “Advertisement,” “Sponsor,” or similar, so that the consumer understands it is not an editorial article.
Another example is an advertisement featuring customer testimonials about investment products, which should indicate whether these customers are independent or associated with the advertised company.
8. Mandatory disclaimers and references:
Advertisements must include necessary disclaimers, such as “Investments are subject to risk, including the risk of losing capital.”
The advertisement should encourage consumers to familiarize themselves with the full information, for example, by directing them to more detailed information online or directly from the service provider.
Are you unsure whether your planned financial services advertisement complies with the guidelines? Contact us, and we’ll be happy to help!
