Regulating Finfluencers Through Investment Advice In Indian Securities Market And Lessons From Australia And Singapore
Aishwarya K, Advocate
ABSTRACT
The individuals who distribute financial content in the form of opinions, recommendations or other advisory nature through the digital platforms are called “finfluencers”. Their expansion have resulted in regulatory challenges for regulators of securities market. In India, while they are not formally registered Intermediaries like Investment Advisers or Research Analysts under the SEBI Regulations, their content often exerts a measurable influence on investment behaviour. This informal market commentaries blur statutory boundaries creating a regulatory perimeter gap as they pose challenges to investor protection, market integrity and also enforcement certainty. Whereas on the other hand, over-expansion of regulatory definitions can risk stifling market efficiency. Therefore, in the era of increasing retail participation and digital financial communication, the tension between regulated entities and finfluencers highlights the need to reassess the concept of “investment advice” within Indian Securities Laws.
This research therefore aims to examine the scope of “investment advice” under Indian Securities Laws framework and identify the regulatory gaps arising from finfluencer activities. It also aims to analyse comparative approaches in Australia and Singapore to assess the suitability of a proportionate regulatory framework for India. For this purpose, the research hypotheses that the existing entity-based framework of Indian Securities Laws are inadequate to regulate digital financial influencers and that there’s a greater need for a tiered disclosure-based approach that could offer a more effective and balanced regulatory solution.
Keywords: Finfluencers, India, Singapore, Australia, Investment Advice.
