India’s markets regulator, SEBI, is increasingly deploying AI tools to combat misleading online investment advice from unregulated social media “finfluencers,” aiming to protect investors and enhance market integrity in a digital era.
India’s markets regulator is stepping up its use of artificial intelligence to police unsolicited investment advice online, as it moves to curb misleading claims from social media “finfluencers”, according to SEBI’s FY26 annual report. Chairman Tuhin Kanta Pandey said the watchdog has deployed tools including Project Sudarsan and SEBI R(AI)DAR to identify unauthorised digital activity that could mislead investors. The effort reflects growing concern that investment advice is increasingly being shaped outside regulated channels.
Pandey said SEBI’s own survey found that 62 per cent of investors are influenced by finfluencers, many of whom operate without accountability or verified performance data. To address that gap, he said the regulator has launched the Past Risk and Return Verification Agency, or PaRRVA, which is designed to independently audit performance claims made by intermediaries and other market participants. Business Today reported that the initiative is intended to bring more discipline to return reporting and help investors separate regulated professionals from unverified online voices.
SEBI has also expanded its digital checks in other areas. According to the regulator’s annual report, it has entered a partnership with Google Play for a verified app label initiative, giving investors a visible signal that a trading app has regulatory legitimacy. The move comes amid a broader push to reduce the risk of fraudulent or misleading apps being downloaded by first-time investors.
Beyond investor protection, Pandey said market integrity remains the regulator’s central concern. SEBI has continued to act against manipulation, insider trading, front-running and corporate fraud, while also tightening derivatives rules by reducing expiry-day concentration, rationalising weekly index options and strengthening intraday position-limit monitoring. Looking ahead, the regulator plans to simplify compliance, widen the cash equities market, improve securities lending and borrowing and launch new digital systems, including SEBI Setu and a pilot project to tokenise corporate bonds using distributed ledger technology.
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