Consumer Interest Groups Urge Government To Ban Opinion Trading Platforms
Consumer Interest Groups Urge Government To Ban Opinion Trading Platforms
Experts appeal to protect people from financial and mental health risks
Emphasizing the need for regulation, the New Indian Consumer Initiative (NICI) and PEN Media Literacy held a virtual workshop, ‘Consumer Interest and the Need for Regulation for Opinion Trading in India’ to highlight the rise and risks of opinion trading platforms.
(NICI is a community-owned platform that fosters interaction on the challenges and opportunities of consumers in the new economy and discusses topics of interest to people across sectors).
The session was attended by consumer interest organizations from states including Tamil Nadu, Gujarat, Rajasthan, Uttar Pradesh, and Delhi.
While advocating for responsible business practices, the experts pressed to protect consumers from financial and mental health risks.
They emphasized the urgent requirement for a coordinated regulatory approach involving multiple stakeholders, including the Securities and Exchange Board of India (SEBI), Ministry of Consumer Affairs, Ministry of Information & Broadcasting and Advertising Standards Council of India to safeguard consumers and curb misleading advertisements.
Opinion trading platforms allow users to risk on real-world events such as elections, stock market movements, and economic trends with monetary stakes.
These platforms portray themselves as gaming, trading and investment platforms. However, they are outside the purview of relevant regulatory bodies, increasing risks for consumers.
With over 5 crore users and transactions exceeding Rs.50,000 crore annually, they flourish on ads, often claiming exaggerated winnings and luring as a reliable source of income.
The participants complained that the lines between gaming, trading, and investment were increasingly blurred. That’s because the platforms (marketed as reliable sources of income), led to significant financial and mental health risks.
The discussion also covered the potential for debt cycles and addiction, especially among young users.
Abhishek Kumar, Convener, NICI, expressed, “We aim to engage with different ministries in our capacity to drive caution and request for intervention against these platforms.”
He held that there were possibilities to manipulate some real-world events if such platforms were not regulated.
The experts pointed to international regulatory frameworks in Singapore, the European Union, and the United States as examples of stricter oversight, contrasting with India’s regulatory vacuum.
The participants were unanimous in their concerns about opinion trading, which is akin to betting and gambling.
Rijitsen Gupta, CEO of the Centre for Responsible Business asked such businesses and their investors to observe responsible business behavior and think of larger societal implications. He suggested that even a regulator like the Reserve Bank of India (RBI) should be concerned as volumes of transactions increase on such platforms.
Shipra Mathur, Founder, PEN Media Literacy and Former Head of Causes & Campaign at Rajasthan Patrika expressed concerns about why the regulatory bodies had not noted the need to regulate opinion trading, following other Asian and Western countries.
The workshop was attended by representatives of multiple consumer interest organizations - Ramjibai Mavani, Former Member of Parliament and Founder of Rajkot Jilla Grahak Suraksha Mandal; Prof. Dr. Duraisingam, Chairman, Consumer Research, Education, Action, Training & Empowerment (CREATE); Rijit Sengupta, CEO, Centre for Responsible Business; Shipra Mathur, Founder PEN Media Literacy, Dr. RD Usmani, Director, Indian Institute of Technology & Entrepreneur Development; Poonam Sharma, President Rahtriya Sammudeshya Vikas Sansthan and Takshit Mathur Tech Entrepreneur.
