Connect with us

Headlines Of The Day

Finfluencers need SEBI registration to offer advice, says ASCI

Social media influencers offering financial advice should be registered with sectoral regulators, and those providing health services or advice should possess relevant medical degrees and certifications, according to fresh guidelines from the Advertising Standards Council of India.

Finfluencers will now be required to register with the Securities and Exchange Board of India before giving advice, ASCI said in a release. “Their registration number must be prominently displayed alongside their name and qualifications.”

For other financial advice, influencers must possess appropriate credentials such as a licence from the Insurance Regulatory and Development Authority of India, be qualified as a chartered accountant, or hold a company secretaryship, the council said.

The latest regulations are an addition to those issued earlier requiring influencers to prominently disclose any material connection with an advertiser.

“As losses to consumers could be substantial and serious, due to improper advice in the categories of health and finance, it is necessary that influencers in these two critical categories are qualified to provide advice and that these qualifications are stated upfront, whenever they put out such advertising posts,” the release quoted Manisha Kapoor, chief executive officer and secretary general of ASCI, as saying.

The ASCI is a self-regulatory body of the advertising industry in India and its regulations are not legally enforceable. The requirements laid out by the ASCI only relate to social media posts that are advertisements.

However, SEBI is working on more holistic regulations that will govern advice offered by financial influencers. In recent interactions, key functionaries of the SEBI have confirmed that a consultation paper is in the works and could be introduced later this year.

SEBI Chairperson Madhabi Puri Buch has said earlier that the regulator does not have a problem with influencers working towards educating the public. But there are concerns that people could be misled by those who are not qualified to offer advice or those doing so with the intention of making personal gains.

The regulator has also taken action against certain individuals in this regard. This year, the SEBI imposed a fine on youtuber PR Sundar and banned him from the capital markets for a year. The influencer settled the case with the regulator. BQ Prime

Copyright © 2023.Broadcast and Cablesat