SEBI Requires Regulated Entities, Agents to Display Names on Social Media

The Securities and Exchange Board of India (SEBI) has proposed new measures to tighten supervision of regulated entities on social media.  

The regulator aims to clearly distinguish content posted by SEBI-registered entities from unregistered individuals in order to safeguard investors from misleading information. 

Key Development: Mandatory Disclosure Rules 

In its consultation paper, SEBI proposed that all regulated entities and their authorised agents must prominently display their registered name and registration number on the home page of their social media channels and alongside each content post.  

This includes mutual fund distributors and portfolio management service distributors. SEBI stated that such visibility will help investors easily identify content posted by verified, regulated sources. 

Statements & Content Standards 

SEBI further suggested that all social media posts which, implicitly or explicitly, promote a regulated entity or its products should be treated as advertisements and must comply with the advertisement code.  

Regulated entities must ensure that content does not include prohibited claims, guaranteed returns, misleading statements or exaggerated risk-return profiles. The use of SEBI’s logo, references to officials or mention of past performance without explicit approval should also be prohibited. 

Impact & Regulatory Outlook 

SEBI chairman Tuhin Kanta Pandey noted that more than 1 lakh instances of misleading online content were flagged on platforms such as Meta, Google, Telegram and X over the past 18 months.  

To counter this, SEBI has intensified engagement with major internet platforms and proposed a verification mechanism allowing only registered entities to advertise investment products. It also suggested a verified label for legitimate trading apps to prevent fraudulent platforms and unregulated advisors from influencing investors. 

Read More: SEBI Permits Incentives for Mutual Fund Distributors to Boost Women Investors and B30 Onboarding! 

Conclusion 

SEBI’s proposed framework seeks to strengthen investor protection by ensuring accountability and transparency across social media channels. With clear identification norms and strict content standards, the regulator aims to limit misinformation and promote responsible financial communication. 

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