SEBI's crackdown pushes finfluencers to rethink ad strategies

The finance sector has long been a lucrative niche for Indian content creators, with brands willing to shell out premium rates for collaborations. However, the days of unchecked financial advice may be nearing an end.

SEBI's recent crackdown on finfluencers signals a market that’s shedding its wild west image for a more regulated terrain.

Prominent creators like Baap of Chart, PR Sundar, and analyst Vijay Thakker have faced fines or had their content removed as SEBI intensifies its efforts to enforce transparency and accountability. Mohammad Nasiruddin Ansari, popularly known as "Baap of Chart," was fined Rs 17.2 crore and banned from participating in the securities market. Similarly, Ravindra Balu Bharti was ordered to return Rs 12 crore in "unlawful gains" earned from an alleged unregistered investment advisory business. SEBI accused Bharti and his firm of offering investment advice for monetary compensation and enticing investors with exaggerated projected returns ranging from 25% to an astonishing 1000%.

Rulebook gets an upgrade

SEBI ’s new guidelines demand registration for financial influencers , credentials disclosure, and a clear avoidance of conflicts of interest. Rahul Tekwani, Managing Partner of Branding Edge, explains, "Collaborating with SEBI-registered intermediaries like Registered Investment Advisors (RIAs) and emphasising transparency can help finfluencers maintain credibility. While the absence of formal financial qualifications can be a hurdle, highlighting relevant education or professional experience and being transparent about the basis of their advice can build trust and authority."

Tekwani also raises concerns about cash transactions and the use of platforms like WhatsApp and Telegram for financial discussions. “SEBI must also expand its oversight to include communication platforms like WhatsApp, Telegram, and Apple iMessage, which are commonly used for financial discussions and advice. Enhanced monitoring of these channels can ensure compliance and foster a more transparent environment for retail investors,” he adds.

High stakes in the finance niche

For established finfluencers, the stakes are immense. A seasoned creator in India can rake in Rs 4–5 lakh per month through brand deals and ad revenue .

Justin Lawrence, YouTube Platform monetisation head, who handles many finfluencers in an exclusive interview with exchange4media reveals, “A finance creator with 10 million views on long-format content can earn anywhere between $3,000 to $4,000 monthly from ad revenue alone. This is significantly higher than creators in other niches due to the higher CPM finance content attracts.”

Building credibility amid chaos

Rahul suggests, “The financial influencer community must prioritise transparency, ethics, and clear communication. He explains that some influencers manipulated stocks to benefit personally, often at the expense of retail investors. "Such strategies may yield short-term gains during bull markets but backfire during corrections, leading to disastrous consequences for investors and influencers alike.”

To rebuild trust, Rahul emphasises categorising content clearly—be it informational, advisory, or promotional—and including disclaimers. "Transparency about revenue sources, such as earnings from sponsored posts or affiliate marketing, is crucial for building trust. Collaborating with SEBI-registered intermediaries can further strengthen credibility.”

Justin echoes similar sentiments, noting that financial influencers bear a unique responsibility. “Unlike beauty or entertainment creators, finfluencers cannot afford to make mistakes. A wrong suggestion could lead to significant losses for their audience.”

Modern audiences won’t tolerate misleading content

In today’s digital age, audiences are quick to disengage from unethical practices. Rahul notes, “Transparency and ethics aren’t just best practices—they’re survival strategies. Modern audiences are perceptive and won’t tolerate misleading content, which can erode long-term credibility.”

Focusing on education and risk awareness is one way forward. “Informing audiences about market volatility, risks, and the value of long-term strategies not only aligns with ethical conduct but also strengthens trust,” he adds.

Justin agrees, emphasising the value of authenticity over flashy gimmicks. “Substance in content outweighs hidden profits. Finfluencers must prioritize accuracy and relevance over viral trends.”

A new era of content creation and monetisation

“Unlike beauty or entertainment creators, finfluencers cannot afford to make mistakes. A wrong suggestion, such as promoting an unverified finance app or investment strategy, could lead to significant losses for their audience,” he explained. The need for authenticity and thorough research is paramount in this niche. Justin recommended that creators focus on providing general financial education rather than specific stock or investment advice to avoid misleading their followers.

He also suggested exploring a membership-based model for personalized guidance, akin to consulting with a chartered accountant. “Memberships could provide tailored advice, ensuring creators maintain credibility while offering added value to their audience,” Justin said.