Does your bank or credit union promote credit loans or savings products on social media? If so, it’s a great way to get in front of potential customers and members and promote your financial products. But did you know that you have to comply with financial laws and regulations that govern credit and loan products, such as Truth in Lending and the Truth in Savings Act? Because if you don’t maintain social media compliance for banks or social media compliance for credit unions when promoting savings or loan products, you can get in serious legal trouble.
As a social media attorney for the financial services industry, and I’m here to teach you how to comply with the Truth in Lending and Truth in Savings Act when promoting financial products on social media. So first, let’s start with the law itself. What do your bank or credit union need to do if you’re promoting credit cards, loans, savings products, or other types of financial products online? You have to put your terms and conditions that govern that financial product in a clear and conspicuous manner. And you know what? That makes sense. The purpose of these laws are so that consumers can compare apples to apples. Meaning, how does your credit product compare to another financial institution’s credit product? And the only way to do that is to give them the terms and conditions. So just things like the specific APR or the APY, whether there’s any fee involved, if there’s an introductory rate, how long does that introductory period last, and how does the APR or APY change over time.
These terms and conditions are always there when your bank or credit union promotes a credit card, or a loan, or a savings account. But in the world of social media, things are different. What I mean is that on a magazine you could put all the terms and conditions right there at the bottom, but on a social media post you don’t have all that room. You don’t have all that space. But, according to FFIEC Social Media Guidance you still need to include the disclosures and the disclaimers.
For credit and loan compliance on social media, you must follow these three steps. First, you can follow what’s called the “one-click away” rule. Meaning, so long as your social media post that promotes that credit or savings product has a hyperlink that goes directly to the complete terms and conditions, you can then use social media to promote those financial products and services. The reason it’s called a one-click away rule is that it must be one click from that link directly to the terms and conditions that govern that specific financial product. You can’t have it go to your homepage. You can’t have people click the link and try to navigate and find it. It must go directly to the specific terms. But that’s not all.
Second, you need to have clear language accompanying the hyperlink to let consumers know that the complete terms and conditions are located on a different page. You can do this in so many different ways. You can say things like, “For complete terms and conditions, visit [website link].” Or you could be simple and just write, “Terms:” and then include the link.
The third thing you need to do is use clear language in the hyperlink itself. What I mean is that the hyperlink should say something like, “yourbank.com/credit terms.” Something where consumers know, when they click the link, they’re going to get the complete terms and conditions of that financial product.
Now, sometimes you might use what’s called a bit link, meaning a link shortener, so you don’t have a really long and unattractive looking domain name within your post. That’s okay. You can still use that, but just be sure to rename the link. So it might say bit.ly/creditterms, as opposed to bit.ly/29xc4wyz11. People don’t know what that link means. So you want to make sure that your posts are crystal clear.
I hope this helps your bank or credit union when promoting financial products online. But this is only one of many different types of financial laws that govern social media. And if your bank or credit union doesn’t have a social media risk management program that covers things like how to comply with the Truth in Lending and Truth in Savings Act and all of the other financial laws and regulations that are out there, such as the Fair Housing Act, Member FDIC statement, how to manage employee social media legal risks, etc your bank is noncompliant with federal laws and regulations that govern the social media industry.
To achieve social media compliance for banks or social media compliance for credit unions, your need to bank need to know [1] what are the financial laws that govern your bank or credit union, and [2] set up a social media risk management program to help mitigate those risks at your financial institution. The Social Media Law Firm is here to help.
We’ve prepared a free guide on how banks and credit unions can manage social media legal risks. Just visit financialfridays.co to download the guide today. That’s not financialfridays.com. We couldn’t afford that domain name. It was like $2,000. But please visit financialfridays.co, where you can download our free guide on how your bank or credit union can manage social media legal risks. I hope this guide is going to be helpful for you in creating your social media risk management program, and we’d be happy to assist you in creating your risk management program. Just contact us today.
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