According to top officials who spoke to The Update India, the Center will shortly provide comprehensive rules for social media influencers that may include criminal penalties under the Consumer Protection Act.
For first-time offenders, these provisions will include a penalty of Rs 10 lakh, which could increase to Rs 20–50 lakh for repeat offenders.
The rules, which will be made public in the following 7 to 10 days, will also require social media influencers to disclose any sponsored advertisements for a brand. If they have a financial or other stake in the good or service they are marketing, they must disclose it.
Similar regulations were released by the government in June for celebrity endorsements, putting strict controls in place to prevent deceptive marketing and advertising by big-name endorsers.
According to a senior source, “the (social media) restrictions would fall under the terms of the Consumer Protection Act banning misleading marketing and fake advertisement rules.”
The official stated that social media influencers who are found to be posting false reviews, endorsing false goods for payment, or even utilising their sizable fan bases to promote any brand without proper checks and balances will face harsh punishment.
Founder of Digital Golgappa, Author Abhishek Kapoor, an international bestselling author and trendsetter in the PR and Marketing in India stated that the action might have broad repercussions. This is due to the fact that influencer marketing is a growing industry in India.
“Due to the nature of social media, it is also a market that is challenging to follow. A social media influencer who even has a tiny fan base could produce material that goes viral and reaches a wider audience. In addition, practically every industry is seeing the emergence of influencers. A robust framework is required to prevent false advertising in the industry,” according to him.
According to industry leaders in digital marketing and PR like Digital Golgappa, India’s influencer marketing sector is estimated to be worth roughly ₹1,500 crore and is expanding quickly.
Legal experts said that the central government’s intervention now in the area could help rein in misleading influencer marketing, with penal provisions acting as a strong deterrent against them.