Circular Date: November 28, 2025
Source: SEBI (via official circular)
Social media has become a powerful channel for financial communication — from educational posts to product promotions. But the rise of unregulated “finfluencer” content has also increased the risk of misleading claims and investor confusion.
To address these concerns, SEBI has released a consultation paper proposing a structured framework for how regulated entities and their agents should operate on social platforms. Though not yet a regulation, the paper signals the direction SEBI intends to take.
This explainer summarises the key proposals and what they may mean for AIFs, Mutual Funds, Portfolio Managers, Investment Advisers, Research Analysts, brokers, distributors, and other intermediaries.
Key Proposals at a Glance
1. Mandatory Display of SEBI Registration on Social Media
SEBI proposes that all regulated entities and their authorised agents must clearly disclose:
SEBI-registered name
SEBI registration number
These disclosures must appear:
On the profile page of the entity or agent
Alongside each post or video shared on social platforms such as LinkedIn, X, YouTube, Instagram, Facebook, and Telegram
This ensures that investors can immediately identify whether the information is coming from a regulated source.
2. Restrictions on Misleading or Promotional Content
The consultation paper lays out specific prohibitions. Regulated entities must avoid:
False, biased, deceptive, or misleading statements
Content that may mislead investors by omission
Claims that exploit investors’ limited knowledge
Exaggerated claims or implied guarantees
Any promise of assured or risk-free returns
Reference to past performance unless explicitly permitted
Use of SEBI’s logo or any implication of SEBI endorsement
Associating with influencers who provide unregulated investment advice
Essentially, content must be factual, transparent, and free from hype.
3. Promotional Content Will Be Treated as Advertising
Any social-media communication that directly or indirectly promotes:
The entity
Its products
Its services
…would be classified as an advertisement.
Such posts must comply with the specific advertising code applicable to that category of entity (MFs, AIFs, PMS, etc.). Even content that appears “educational” may fall under advertising if it contains promotional cues.
4. Immediate Applicability Once Finalised
Although this is currently a consultation paper, SEBI has indicated that once the framework is finalised, the provisions will become applicable immediately. Entities should therefore start preparing for compliance.
Implications for AIFs, PMs, MFs, and Distributors
If your entity maintains a presence on social platforms, here’s what this could mean:
Review all official and agent-operated accounts
Set up consistent SEBI disclosure text for profiles and posts
Reassess marketing and educational content to avoid exaggerated claims
Treat any product or service promotion as an advertisement requiring compliance checks
Train internal teams, distributors, and partners on updated standards
This may also require updating content workflows and archiving mechanisms for compliance audits.
Why SEBI Is Taking This Step
The consultation paper is a response to:
Increasing instances of unregulated financial advice online
Rapid growth of finfluencer-led promotions
Blurred lines between education and solicitation
Investor protection concerns
The need for uniform communication standards across digital channels
SEBI’s stance is clear: regulated entities must be easily identifiable and fully accountable for the content they publish.
What Regulated Entities Should Do Now: A Quick Checklist
Map all social media accounts managed by the entity, teams, or distributors
Prepare the required disclosure formats (name + registration number)
Review old posts for compliance gaps
Identify content that may fall under “advertising”
Establish internal approval processes for social media content
Train teams involved in communication and distribution
Conclusion
SEBI’s consultation paper marks a significant step towards standardising digital communication by regulated financial entities. While not yet binding, the proposals point to an imminent shift in how AIFs, MFs, PMs, IAs, RAs, and distributors must conduct themselves online.
Clear disclaimers, compliant content, and transparent communication will soon become non-negotiable. Entities that prepare early will find the transition far smoother once the final circular is issued.