SEBI And Financial Influencers : New SEBI Guidelines For Financial Influencers

SEBI Guidelines on Financial Influencers

Financial influencers called “Finfluencers” – are becoming popular. They often share tips about investing, give advice on stocks or promote trading apps on platforms like YouTube, Instagram, Telegram and others. Many people getting wrong or risky advice. To protect people from such content, the Securities and Exchange Board of India (SEBI).

Who is a Financial Influencer?

A Finfluencer is any person who:

• Talk about money and finance topics like the stock market, mutual funds, insurance, trading, saving, or budgeting.
• Posts videos or messages on social media like YouTube, Instagram, telegram, etc.
• Tries to guide people on where to invest or promotes financial products like apps, stocks or mutual funds.
• May or may not be a qualified financial expert or registered with SEBI.

Why Did SEBI Make These Guidelines?

SEBI made these rules because it saw a big increase in people giving investment advice online without any official permission.

Key Restrictions by SEBI on Finfluencers

1. No Investment Advice Without SEBI Registration

If you are not officially registered with SEBI as an Investment Advisor (IA) or Research Analyst (RA):

• You cannot tell people which stock or mutual fund to buy, sell or hold.
• You cannot give personal advice like, “invest in this stock for high returns” or “sell this mutual fund now.”

(Note: Only SEBI registered experts are allowed to give such advice.) 

2. NO Promoting Tie -Ups with Registered Entities

SEBI banned stock brokers, mutual fund houses, and other regulated entities from:

• Paying unregistered influencers to promote their services or platforms.
• Associating with them for referral programs or affiliate marketing.

Example : A broker cannot pay a YouTuber (who is not SEBI registered) to create videos promoting their trading app.

What Educational Finfluencers Are Allowed to Do

SEBI says that people who are not registered can still share educational content, but they must follow some strict rules.

 

Penalties for Violations

SEBI has introduced strict penalties for those who break these rules:

• First-time offense: Fine up to ₹10 lakh and 6-month  content suspension.
• Repeated violations: Fine up to ₹50 lakh and a possible permanent ban.
• SEBI has also asked social media platforms to remove harmful content or block certain accounts.

SEBI’s Future Plans for Financial Influencers

SEBI is working on new steps to make the world of financial content safer and more trustworthy:

• Easy Registration Process : SEBI wants to make it simpler for genuine content creators to become registered financial advisors or analysts. This will help more honest and knowledgeable people give proper advice. 
• Checking Profit Claims : “SEBI plans to create a new body called Performance Validation Agency (PVA).” This agency will check whether an influencer’s profit or loss claims are true or fake. 
• Working with ASCI (Ad Rules Body) : SEBI is working with ASCI (Advertising Standards Council of India) to make sure that Influencers must show their SEBI registration number if they are registered. Influencers cannot make false or fake claims in paid ads or sponsored content. 

What Should You Do as a Content Creator?

• Focus on educational content, not recommendations.
• Add disclaimers and disclosures clearly.
• Avoid sponsorships from financial companies if unregistered.
• Stay updated with SEBI and ASCI rules.
• If serious about giving advice consider SEBI registration.

NOTE : SEBI’s new rules are a good step to make financial content on social media safer and more honest. Whether you are someone who gives advice or someone who follows it, it is very important to understand these rules to stay safe and avoid mistakes.

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