Market regulator SEBI has taken a big step to crack down on unregistered financial influencers. SEBI has asked all registered entities related to the capital market such as stock exchanges, clearing corporations, depositories and their agents to break their agreements with unregistered investment advisors within three months. SEBI has given time till January 2025 for this.

SEBI has issued an important circular in this regard. This step of SEBI is important in terms of controlling those who claim huge returns on social media and those who sell their advisory services under this pretext.
 

In fact, many fin-influencers have agreements with brokers. Under this, they get various types of commissions on opening accounts under their affiliate program. SEBI had said in its order issued on 26 August this year that the entities registered with it cannot have any direct or indirect relationship with any unregistered investment advisor. Preparation of new digital platform SEBI has made it clear in its latest circular that its rules regarding agreements will not apply to 'Specified Digital Platform'. What should be the outline of this digital platform? For this, SEBI has issued a separate draft consultation paper. Through this consultation paper, SEBI has proposed a digital platform that has full arrangements for the protection of investors' interests. There should be a mechanism to resolve investors' complaints within a stipulated time. SEBI wants that no unregistered finance provider should be associated with this specified digital platform and neither should they make misleading claims of returns. After taking opinion from all the parties, SEBI will issue the final rules related to this digital platform. All the parties can give their opinion to SEBI by 12th November.