The Union Government of India is preparing some new and stricter guidelines for influencers to follow. Read on to find out more information.
India is a country with a population of 1.4 billion. The Influencer Marketing Report 2022 estimates a compound annual growth of 5%, pushing the total value of the influencer industry to 2,200 crore rupees (AED 991,152,815). With a large chunk of the population looking at earning money through influencing, there has been an influx of misleading and undisclosed promotional posts.
On the 24th of November, the Union Government of India released rules focusing on weeding out false and misleading advertising. As per various reports, these laws will require influencers to disclose any monetary benefits and paid partnerships with brands. Those who fail to do will be penalised harshly. On 7th September, it was reported that the first offense could cost them up to 10 lakh rupees (AED 54,063), and repeated offenses would increase the fine to 50 lakh rupees (AED 225,317). These regulations are set to be officially released in December of this year. Not only that, the Advertising Standards Council of India (ASCI) reports that they received several complaints on the misleading nature of some promotional posts done by influencers (including finfluencers), which is what is leading to the expedition of these rules.
Additionally, the Securities and Exchange Board of India (SEBI) is looking to crack down hard on finfluencers. During a Confederation of Indian Industry conference, full-time SEBI member S.K. Mohanty said “We are working on the guidelines for financial influencers.” These rules come after the sharp increase in influencers providing financial advice – without a license – under the guise of financial literacy on their respective accounts.
For those unaware, finfluencers – or financial influencers – are individuals who post financial advice on their social media platforms. They post about stocks, shares, and mortgages, and currently are following the trend of providing unsolicited cryptocurrency advice. There are several experts who post on the matters stated above, but the issue lies with those who are providing information based on brand sponsorships or partnerships. This can be heavily misleading to those looking to invest their hard-earned money.
These rules are long overdue. Several countries around the globe have organisations that set their own set of rules for finfluencers, like the UK’s Financial Authority looking to regulate financial promotions on social media. Once the rules come into effect in December, the public subscribing to these influencers will be able to have a more transparent idea as to whether any posts uploaded by influencers are part of their regular posts or just part of a brand promotion. It’ll also help in exposing those who are working to defraud or scam their audience.
Stay updated on more news regarding influencer laws by subscribing to the ITP Live newsletter below or by clicking the bell icon on the page.