 "Finfluencer advertisement using govt logo by YouTube stirs a hornets' nest")
A full-page advertisement (ad) by YouTube in two daily newspapers featuring a financial influencer (finfluencer) created an uproar on social media platforms on Monday.
Netizens' comments poured in on the approach of the advertisement, citing the tightening of regulations by the Securities and Exchange Board of India (Sebi) for ads issued by registered investment advisors (RIAs).
The advertisement concerned, featuring a finfluencer who has nearly 4.5 million subscribers on YouTube, with the tagline, ‘Trust only the real experts’, created an uproar big enough for the Minister of State for Ministry of Electronics and Information Technology (MeitY) Rajeev Chandrasekhar to issue a clarification on Twitter.
Financial planners and experts raised questions about the ad’s tagline, which stoked a debate on whether finfluencers were the “real experts” or Sebi-registered advisors.
“Given that these types of advocacy ads could be misinterpreted, I have advised more careful use of government logos in these campaigns by private platforms,” wrote Chandrasekhar, in a post on Twitter.
The ad issued by YouTube used logos of Group of Twenty and MeitY, which led to confusion on whether the government was endorsing finfluencers.
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“MeitY encourages all digital platforms to create awareness of safety and trust and accountable internet and is supportive of all genuine campaigns/advocacy for this, but that is not an endorsement,” he added.
Of late, the finfluencers have been at the receiving end amid rising instances of stock price manipulation and pump-and-dump schemes.
Sebi’s new code of ads for RIAs prescribes strict dos and don’ts for them, while there are no specific regulations governing finfluencers. This has prompted several experts to call for a more level playing field.
The new code directs RIAs to not use extensive technical terminologies, refrain from making statements which show projections or assumptions, and restrictions on referring to past performance, among a raft of other measures for investor protection.