Only 6% of finfluencers are SEBI-registered, but one in three recommend stocks

A recent study has revealed that a mere 6.3% of financial influencers, commonly known as "finfluencers," are registered with the Securities and Exchange Board of India (SEBI). Despite this low registration rate, these influencers continue to wield significant influence over retail investors. Their growing popularity on social media platforms has made them key players in shaping investment decisions. Alarmingly, the study also found that one in three finfluencers actively recommends stocks to their followers. This trend raises concerns about the potential risks for novice investors who may rely on unverified financial advice. The lack of regulatory oversight for the majority of these influencers poses a challenge for authorities aiming to protect consumers from misleading or harmful recommendations. In response to the findings, SEBI has been urged to enhance regulatory measures to ensure greater accountability among finfluencers. By encouraging more influencers to register and adhere to guidelines, SEBI aims to create a safer investment environment. As the digital financial advisory space continues to grow, the balance between innovation and investor protection remains a critical focus for regulators.

— Authored by Next24 Live