2025: The year regulation caught up with influencer marketing

2025 marked the year when regulation finally caught up with India’s fast-growing influencer economy. For nearly a decade, creators expanded faster than the rules meant to govern them, blurring the line between advice and promotion while brands borrowed credibility through association. Platforms, for the most part, remained neutral conduits. That balance decisively shifted this year. Regulators stepped in not to curb the creator economy, but to define its limits, redraw accountability lines and restore consumer trust.

Influencer marketing today sits firmly within India’s formal advertising and financial regulation framework. The shift has been gradual, but 2025 is when enforcement became visible, data-backed and difficult to ignore.

Regulatory Pressure Builds on Influencer Advertising

According to the Advertising Standards Council of India (ASCI) in FY 2024–25, 14 per cent of all advertisements processed by ASCI were linked to influencer-related violations. Persistent issues included failure to disclose paid partnerships and promotions of prohibited categories.

During the year, ASCI processed 1,015 influencer-linked advertisements. Of these, 98 per cent required modification, highlighting systemic lapses rather than isolated errors. A majority of flagged posts lacked adequate disclosure. Around 56.8 per cent carried no disclosure label at all, while 43.2 per cent buried disclosures within hashtags, rendering them ineffective under ASCI norms.

2025 marked the year when regulation finally caught up with India’s fast-growing influencer economy. For nearly a decade, creators expanded faster than the rules meant to govern them, blurring the line between advice and promotion while brands borrowed credibility through association. Platforms, for the most part, remained neutral conduits. That balance decisively shifted this year. Regulators stepped in not to curb the creator economy, but to define its limits, redraw accountability lines and restore consumer trust.

Influencer marketing today sits firmly within India’s formal advertising and financial regulation framework. The shift has been gradual, but 2025 is when enforcement became visible, data-backed and difficult to ignore.

Regulatory Pressure Builds on Influencer Advertising

According to the Advertising Standards Council of India (ASCI) in FY 2024–25, 14 per cent of all advertisements processed by ASCI were linked to influencer-related violations. Persistent issues included failure to disclose paid partnerships and promotions of prohibited categories.

During the year, ASCI processed 1,015 influencer-linked advertisements. Of these, 98 per cent required modification, highlighting systemic lapses rather than isolated errors. A majority of flagged posts lacked adequate disclosure. Around 56.8 per cent carried no disclosure label at all, while 43.2 per cent buried disclosures within hashtags, rendering them ineffective under ASCI norms.

Paid Content Disclosure Comes for Media Houses Too 

In another significant development, ASCI extended disclosure obligations beyond creators and brands to media companies themselves. A new clause added to the Code for Self-Regulation in Advertising requires media outlets to clearly label paid or sponsored content on their social media handles.

Under Clause 1.8, disclosures such as “Advertisement,” “Sponsored,” “Partnership,” or platform-enabled tags must appear upfront, ensuring that promotional content is not mistaken for editorial. This move followed consumer complaints around undisclosed promotions appearing alongside news content on high-credibility platforms.

With social media now a primary distribution channel for news, ASCI has emphasised that transparency is essential to protect editorial trust. The rule reinforces long-standing journalistic norms in a digital-first context, making it harder for advertising to quietly blend into reportage. 

Platforms Step In: Meta Makes SEBI Verification Mandatory

By mid-2025, platforms also began enforcing regulator-led compliance. Meta rolled out a sweeping policy on July 31, mandating SEBI verification for all investment-related ads targeting Indian audiences, regardless of where the advertiser is based.

Advertisers are now required to submit their SEBI registration details, including registration numbers and contact information, which are displayed publicly on ads along with disclaimers. For those exempt from SEBI registration, such as financial educators, alternate verification is mandatory through government IDs or business documents.

Once verified, these credentials remain visible in Meta’s Ad Library for up to seven years. Even strictly educational financial content, while exempt from SEBI registration, must go through the alternate verification route, signalling a platform-wide shift toward traceability and accountability.

This builds on earlier ASCI guidelines from 2023, which required finfluencers to disclose SEBI registration details and professional qualifications when offering investment-related advice.

Anurag Tyagi, Partner, Deal Value Creation Services, BDO India, "2025 saw the most deliberate effort from SEBI to elevate M&A since the 2011 SAST regulations. This overhaul seemingly intends to shift India from a promoter-dominated M&A environment to a market-driven, rules-based system where transparency, price integrity, and governance drive value creation. 

“The more than incremental reforms in the form of notifications run across three themes: Improving governance, enhancing market integrity, enabling efficient buyouts, de-listings and acquisition financing. SEBI is solving for a market where deal prices are fair, disclosures are timely, information leaks are curbed, related-party opacity is reduced, and buyouts or de-listings take place. For dealmakers, the changes mean clearer pricing, stronger governance expectations, smoother buyout. delisting pathways, and more predictable capital-raising for acquisitions. Given the shifts exit opportunities for investors, markets are likely to witness a different kind of M&A in the next two to three years. However, smart money should start chasing true value creation." 

What Lies Ahead: AI Content and the Next Regulatory Frontier

While 2025 focused heavily on financial transparency and advertising disclosures, the next phase of regulation is already taking shape. The Ministry of Electronics and Information Technology has proposed amendments to the IT Rules, 2021, that would require mandatory labelling of AI-generated content across text, audio, video, and images.

The proposal comes amid a sharp rise in AI-generated content and growing concerns around deepfakes, misinformation, and synthetic media. Deepfakes entered mainstream regulatory discourse after a manipulated video of an actor went viral in 2023, prompting strong government intervention. Prime Minister Narendra Modi has since described deepfakes as a new digital “crisis,” underscoring the urgency for safeguards.

If implemented, the amendments would fundamentally alter how creators disclose AI use, pushing platforms and influencers toward greater transparency and reshaping content authenticity norms. 

ASCI is preparing for the next wave of AI applications in advertising, from generative content to targeting algorithms, ensuring that innovation and consumer trust go hand in hand. "Our focus will remain proactive regulation, industry collaboration and creating frameworks that protect consumers while allowing creativity and business growth to flourish,” Manisha said. 

Taken together, 2025 marks a turning point. Influencer marketing in India is no longer operating on implied trust or loose disclosures. Regulators, platforms, brands, and creators are now part of a shared accountability framework.

Source: E4M