The Securities and Exchange Board of India (SEBI) is taking firm steps to protect investors from misleading content on social media. Since October 2024, SEBI has removed more than 70,000 posts and accounts that shared inaccurate or fraudulent financial information. This crackdown aims to address misinformation and strengthen the regulation of online financial influencers who may mislead investors.
SEBI’s Actions to Safeguard Investors
SEBI has been actively collaborating with major social media platforms to monitor and take down harmful content. The goal is to protect individuals who are new to investing and might fall prey to unverified financial advice. SEBI’s whole-time member, Ananth Narayan, discussed these efforts at the Association of Registered Investment Advisors (ARIA) summit.
Narayan expressed concern over the rise of unregistered investment advisors and research analysts who exploit people’s growing interest in stock markets and mutual funds. These unregistered entities often provide unreliable or misleading financial tips, putting investors at risk.
UPI ‘Payright’ Handle for Safer Investments
To help investors identify genuine financial advisors, SEBI has introduced a UPI ‘Payright’ handle. This tool will make it easier to distinguish between registered advisors and fraudsters. By using this handle, investors can verify whether they are dealing with authorized entities and avoid falling into scams.
Nationwide Survey to Understand Investor Behavior
SEBI is also planning a large-scale nationwide survey to better understand how investors behave, what influences their decisions, and how the regulator can improve its investor outreach. This survey will help SEBI develop more effective strategies for educating and protecting investors.
Strengthening the Financial Ecosystem
Narayan emphasized the importance of ongoing discussions between SEBI and financial market participants, including investment advisors, mutual fund distributors, and portfolio managers. By improving communication and clarity around the roles of these professionals, SEBI aims to streamline the financial advisory ecosystem and make it safer for investors.
Foreign Investment and Economic Growth
Narayan also discussed the recent rise in foreign portfolio investor (FPI) debt inflows. This trend has been supported by India’s inclusion in global debt indices, which has diversified the types of investments flowing into the country. However, he noted that for India to continue attracting foreign investments, the country must maintain strong economic growth, financial stability, and sound governance practices.
Upcoming SEBI Meeting Under New Leadership
SEBI’s first board meeting under the leadership of its new chief, Tuhin Kanta Pandey, is scheduled for March 24. The meeting will cover several important topics, including:
- Easing disclosure requirements by raising threshold limits.
- Introducing a settlement scheme for algorithmic brokers.
- Extending the fee collection period for research analysts.
Conclusion
SEBI’s proactive steps are geared toward protecting investors and creating a safer financial environment. Whether it’s removing misleading social media content, enhancing investor verification through the UPI ‘Payright’ handle, or encouraging responsible financial advice, SEBI is working to safeguard the interests of both new and experienced investors.
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