In a major blow to the financial influencers (finfluencers), the Securities and Exchange Board of India (Sebi) has restricted their use of live stock market data in educational content.

Stock market educators can only use stock prices with a three-month lag, effectively preventing them from offering real-time trading tips disguised as education, the circular said.

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“A person engaged solely in education shall mean that such person is not engaged in any of the two prohibited activities. Such person should not be using the market price data of the preceding three months to speak/talk/display the name of any security including using any code name of the security in his/her talk/speech, video, ticker, screen share etc. indicating the future price, advice or recommendation related to security or securities,” said the circular.

This move is expected to end the illegal advisory businesses that many finfluencers operate without Sebi registration. Sebi first restricted associations between registered and unregistered entities in its October 2024 circular, and the latest update on January 29 further tightens the rules.

“These regulations have come into force with effect from August 29, 2024,” it said.

The circular said that the stock market educators cannot use livestock prices with only data with a three-month lag. The registered market entities cannot associate with finfluencers in any way that involves monetary or non-monetary compensation.

Further, the investor education is allowed, but educators must not give investment advice or make performance claims without Sebi’s approval.

Educators cannot use stock names, codes, or price data from the past three months in any form that could imply investment advice, it said.

Sebi said it is the responsibility of the persons regulated by Sebi to ensure that any person associated with them or their agent, directly or indirectly, does not engage in any of the above-mentioned two prohibited activities, directly or indirectly.