India's Influencers Face a Compliance Reckoning

For years, India's influencer economy has flourished in a regulatory limbo with the fine line between the creator's own opinion and an endorsement that the audience consuming it could not see. It's narrowing quickly that grey area.

The industry is a fast-growing one, but slowly developing rules

As per the survey data, nearly 90% of Indian consumers make purchases based on creator recommendations, and the influencer marketing industry is expected to soar to ₹3,375 crore by 2026, expanding at a compound annual growth rate of 25 per cent.

Until recently however the regulatory oversight has not been commensurate with the times, as in the past, the Advertising Standards Council of India registered 1,409 violations of regulations by influencers till November 2025, 94 per cent of which were for not disclosing paid partnerships.

What the Rules of 2026 are asking

ASCI's new guidelines for 2026 include the following changes: Disclosure of sponsorships must be done verbally in the first 10 seconds of a video, as well as in text format; For the first time ever, specific disclosure rules are extended to AI-generated virtual influencers, meaning that disclosure of any AI-generated video must be done via an AI-disclosure label and a normal "paid content" disclosure for any promotional post.

Guidelines make it clear that disclosures should not be hidden in hashtag groups and/or behind "read more" links. Influencers need to be held accountable for fooling consumers, says ASCI council chief executive Manisha Kapoor.

To draw special scrutiny to finance and health

The Securities and Exchange Board of India also issued a separate order to limit unregistered financial influencers, saying that regulated entities will not be allowed to interact with them and that time-lags must be there between providing quotes and real-time information on stocks.

The parallel Addendum 2 of ASCI states that health and finance influencers must show relevant credentials when providing technical advice - SEBI registration or CA or CFP (for financial content) and medical or nutrition credentials (for health content). One compliance consultant who works with creator agencies said, “The rules didn't affect what creators say, it was about what creators can no longer pretend they don't know.”

A real-time Industry Adjusting

But creator reactions have been mixed. In some cases, the finfluencers have gone ahead and applied for formal SEBI registration, viewing the registration as a competitive advantage instead of a mandate; in others, they have diversified from specific investment recommendations to content on financial education that lies outside the regulated domain of financial advice.

While, on the other hand, brands are increasingly using a compliance review as a part of the brief right from the start — something industry observers say they are beginning to do in a similar way to how they did with brand safety before.