Sebi has issued new guidelines to restrict finfluencers from using up-to-date share price data in educational content and prohibits unregistered finfluencers from making claims about returns.
On January 30, 2025, India’s Securities and Exchange Board (SEBI) issued a draft circular aimed at curbing the growing trend of “finfluencers”—financial influencers who promote stock tips under the guise of educational content. The new guidelines target social media influencers who offer stock market advice without being officially registered or regulated by Sebi.
Sebi, the capital market regulator in India, has stated that influencers promoting financial content must refrain from using current share price data when delivering educational material. The restriction also includes prohibiting finfluencers from discussing any specific security by name or using code names related to stocks, particularly if they are not registered with Sebi. This is to ensure that their content remains purely educational and not promotional in nature.
The draft circular also prohibits finfluencers from making claims about specific returns, which often mislead followers. Sebi has made it clear that penalties for such violations could include fines or suspension of registration.
These measures come in response to growing concerns about unregulated financial advice online, where influencers—sometimes without formal qualifications—market stock tips that could lead to risky financial decisions for retail investors. This move by Sebi aims to ensure that financial advice and content on social media remain transparent, responsible, and in compliance with market regulations.
With this new draft, Sebi is making an effort to protect retail investors from potential harm caused by misleading financial advice and ensuring that those giving advice are qualified and registered to do so.
