Retail investors across Europe are increasingly being nudged into financial decisions that may not serve their interests, according to a new report by the Brussels-based non-profit Finance Watch. The organisation warns that online platforms and social media influencers are deploying a range of manipulative design tactics that obscure risks and amplify potential returns, particularly affecting younger and less experienced investors.
The report, published on Tuesday, examined the websites and apps of 24 banks, neobanks and trading platforms, as well as the social media activity of 59 financial influencers, or 'finfluencers', in Germany, Spain, Czechia and Hungary. It identified a set of recurring patterns that Finance Watch says can steer investment choices or hide crucial information about product risks.
Among the tactics highlighted are pre-selected investment amounts, countdown timers that create a false sense of urgency, and prominent 'buy' buttons that dominate the screen. The report also notes that influencers often give advice without adequate financial knowledge, and that trendy investment lists can encourage impulsive decisions.
"Potential returns were often emphasised, while information about risks was placed in less visible or collapsible sections," the report states. This imbalance, it argues, can lead consumers, including minors, to make choices that are not aligned with their actual risk appetite.
Call for EU action
Finance Watch is urging EU policymakers to introduce new legislation to restrict or ban such practices. The organisation sees the upcoming Digital Fairness Act, expected from the European Commission before the end of the year, as a key opportunity to address these issues.
"The upcoming Digital Fairness Act is an opportunity to clean up, so that consumers choices reflect their needs and appetite for risk, not the profit interests of platforms and influencers," said Peter Norwood, senior officer at Finance Watch, in a press statement.
The proposed EU legislation aims to protect consumers from unfair and manipulative online practices, and could set new standards for how financial products are marketed and sold online. The Commission has also been promoting financial literacy initiatives across the bloc, as limited financial knowledge is seen as a barrier to making Europe more competitive globally.
Finance Watch also recommends tighter regulation of finfluencers, including a ban on their promotion of retail investment products. "On social media, finance influencers broadcast to vast audiences without credentials or demonstrable competence," the report says. "Financial education is too important to become a disguise for advertising or unqualified advice."
The report comes as European regulators and consumer groups increasingly focus on the digital environment's impact on financial behaviour. Similar concerns have been raised about online harms affecting minors, and the EU has been working on rules to better protect young users. The new findings add to the pressure on policymakers to act decisively.
While the Digital Fairness Act is still in the pipeline, Finance Watch's report provides concrete evidence of the challenges regulators will need to address. The organisation hopes that the evidence will spur swift action to ensure that the digital single market works for consumers, not just for platforms and influencers.
As retail investing becomes more accessible through social media, the line between entertainment and financial advice continues to blur. The report's authors argue that without intervention, vulnerable groups will remain exposed to manipulative design and unqualified advice, undermining the very purpose of financial education.
