There are no easy steps in regulating the space. It will need to be a mix of regulatory outreach to regulated entities and investors going beyond fear and greed
When finance minister (FM) Nirmala Sitharaman took note of finfluencers in India, saying that many of them are misleading people, the issue festering under the surface came up for a more public debate. The ability of an individual to reach many people without the checks and balances of the old-style media, with editors as gatekeepers, has democratised the field. Along with the benefits of removing the ideology-based gatekeeping, it has also allowed field experts to reach out with their knowledge directly. But it has also allowed a new crop of (mostly very young) “experts” who are encouraging others to change their investing behaviour. These “experts” seem to have neither the knowledge nor the intent to act as a long-term fiduciary. Led by the FM’s statement, the regulators will now put in place a set of rules that hope to solve the market failure of conflicted advice and opinion. But investors, too, need to do their share. Read More
