On August 25, markets regulator Securities and Exchange Board of India (SEBI) floated a consultation paper proposing regulations to restrict the association of SEBI-registered intermediaries or regulated entities with unregistered ‘finfluencers.’ Other than undertaking enforcement action against the unregistered ‘finfluencers,’ the paper proposed measures to “disrupt the revenue model for such finfluencers, so that the perverse incentives in the ecosystem reduce.” Comments to the proposal are invited until Sept 15.
It is a truth, almost universally acknowledged, that technological change is always a few steps ahead of regulations. The capital markets are no exception, which is why regulators the world over are a busy lot as they try to keep pace with the changes.
Whether it is India’s own Securities and Exchange Board of India (Sebi), the Securities and Exchange Commission (SEC) of the US, the Financial Conduct Authority (FCA) in the UK, or the Australian Securities & Investments Commission (ASIC), one particular concern appears to be on top of their minds—the growing influence of financial influencers, or finfluencers.