Beware of finfluencers: FM Nirmala Sitharaman warns about finfluencers and Ponzi schemes, urges consumers to be wary
FM Nirmala Sitharaman on Sunday, spoke about Ponzi schemes and influencers and how consumers should be wary of both.
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Finfluencers have become very popular lately. They talk about all things finance. From good investment ideas and schemes, interesting finance apps to tips and tricks. However, with more people putting their entire faith in influencers dictating their purchases, it is important for any influencer to make sure that they promote authentic and safe to use products. With Ponzi schemes and fraudulent messages making the rounds, finfluencers have been brought into the limelight, to make sure that they create genuine content for the benefit of their audience.
Finance Minister Nirmala Sitharaman on Sunday spread a word of caution against finfluencers as there is no proposal to regulate them currently. Moreover, she also mentioned that the number of Ponzi scams have increased. Many finance apps offer extravagant schemes, promising great returns on investment. Sitharaman warned consumers regarding this, informing them that most of these apps are essentially rip-offs. She also informed consumers to not jump into any scheme without doing their own due diligence beforehand. At the end of the day, it is their own hard earned money that they need to protect.
Sitharaman also conveyed that the Finance Ministry is working with the Ministry of Electronics and and Information Technology and the RBI to stamp out duplicitous apps and protect consumers against financial scams.
“We are clamping down on them like never before so that we don’t get that Ponzi apps taking away hard-earned money,” said Sitharaman.
The influencer community has been plagued by inauthenticity for as long as they’ve existed. Without regulation, there is no way a consumer can or should fully trust what an influencer say, say most experts and regulatory authorities. Industry stakeholders from influencer marketing agencies to industry bodies like ASCI to the government are coming together to raise more awareness and find suitable ways to regulate the ecosyetem without stiffling creativity and growth.
