Health and wellness influencers under scanner; Govt to release special guidelines
Various ministries and authorities are working together to introduce special guidelines for finance (finfluencers), health and wellness influencers.
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After a crackdown on finance influencers, government authorities plan to introduce guidelines for health and wellness influencers as the influencer marketing industry continues to grow.
In an interview with Storyboard18, Rohit Kumar Singh, secretary of the Department of Consumer Affairs, said in response to a question about guidelines for influencers operating in finance, health and wellness: "It is currently being worked upon. We are an umbrella organization, and SEBI has already done some work. We are working closely with them to frame guidelines for finance influencers. Regarding health, we have conducted consultations with the Ministry of Health and Family Welfare, Ministry of Ayush, and other ministries. We will soon release a special set of guidelines for health and wellness influencers as well."
Recently, in a significant move, the Securities and Exchange Board of India (SEBI) penalised and barred renowned YouTuber and options trader PR Sundar, the first such action against a finfluencer. SEBI's decision, on May 25, to ban PR Sundar from trading for a year due to an alleged violation of investment adviser's norms serves as a strict reminder of the government's scrutiny over finfluencers. This landmark decision emphasises the importance of regulatory compliance in the financial advisory space.
In April, Finance Minister Nirmala Sitharaman 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.
Other measures: Safeguarding consumers
Singh also spoke to Storyboard18 about introducing more streamlined and AI-led systems to safeguard consumer welfare and protect people from "dark patterns" online.
Dark Patterns encompass a wide range of manipulative practices such as drip pricing, disguised advertising, bait and click, choice manipulation, false urgency, and privacy concerns. This could mean that consumers are being forced to buy products online, their personal data being taken without consent, or even users being shamed for not purchasing a subscription, etc.
He said, "We receive around 1 lakh consumer complaints every month, which has doubled from last year. We are also going to incorporate conversational AI to further address these complaints. There is an integrated WhatsApp bot that can easily help consumers register their complaints online. So, we are definitely improving the interface to make filing a complaint easier."
He added, "We are also in the process of introducing an online dispute resolution (ODR) software and platform. So, once a consumer files a complaint and it doesn't get resolved, the online portal, which is eDaakhil, automatically directs them to file a court case."
