What should Sebi do to attract financial influencers in her niche?

There’s a big problem when it comes to consuming personal finance content on social media. A social media account with a significant number of subscribers will be quite impressive and followers always believe that those tips will work wonders. Groww Certified Content Strategist and Financial Planner Aditi Khandelwal is quoted as saying, “There have been cases where I have seen influencers giving the wrong tips, which clearly shows that they are. no knowledge of the subject”.

The root cause behind this, Arijit Sen, Sebi RIA, co-founder, Merrymind, points out, is the current regulatory framework where content creators have no obligation to disclose whether they really have enough. capacity to represent himself or herself as a Personal Financial Advisor. or not.

While social media monitoring will not be a very easy task, the Securities and Exchange Commission of India (Sebi) is trying to find a solution. On Thursday, Sebi said it was working on a set of guidelines for financial influencers on such platforms.

“It is a long-awaited move in the interest of investors as a whole. It is necessary to monitor the factual and/or untrue claims from content creators and take necessary action for the overall development of the investment industry,” asserted Sen.

What should Sebi do?

Talking about the swift actions needed from the management board, Sebi RIA Avinash Luthria said, “For example, shutting down unregistered investment advisors and research analysts who collect fees from clients . And also changed regulations to prevent most stockbrokers from making reckless recommendations on futures, options and small-cap stocks.”

As a result, SEBI may, in effect, be forced to try to convince the Advertising Standards Council of India (ASCI) to be tougher on financial influencers, advertisers and social media platforms. /traditional. Furthermore, from ASCI’s list of non-compliant entities, SEBI can make a subset of securities-related public disclosures, he said.

On March 10, Sebi cracked down on market operators for allegedly manipulating stocks through social media. It conducted site searches of at least seven individuals and one company across several locations in Ahmedabad and Bhavnagar in Gujarat, Neemuch in Madhya Pradesh, New Delhi and Mumbai.

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