NGOs call for ban on opinion trading platforms

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Consumer interest organizations across India have come together to highlight the urgent need for regulating opinion trading platforms. The New Indian Consumer Initiative (NICI), in collaboration with PEN Media Literacy, organized a virtual workshop to address concerns surrounding these platforms.

The event brought together representatives from Tamil Nadu, Gujarat, Rajasthan, Uttar Pradesh, and Delhi. Discussions focused on the growing risks associated with opinion trading and the absence of a structured regulatory framework.

The Rise of Opinion Trading Platforms

Opinion trading platforms allow users to place bets on real-world events like elections and stock market movements. These platforms promote themselves as gaming, trading, or investment services. However, they operate outside the jurisdiction of financial regulatory bodies, increasing risks for consumers.

With transaction volumes exceeding ₹50,000 crore annually and over 5 crore active users, these platforms thrive on advertisements promoting high returns. Many advertisements present opinion trading as a reliable income source, which raises concerns about misleading claims and financial risks.

Consumer Concerns and Expert Insights

Abhishek Kumar, Convener of NICI, emphasized that these platforms blur the lines between gaming, trading, and investment. He highlighted the financial and mental health risks posed by exaggerated claims of profitability.

“The rapid rise of opinion trading platforms in India is a cause of concern for consumers, where the lines between gaming, trading, and investment are increasingly blurred. These platforms, often marketed as reliable sources of income, are leading to significant financial and mental health risks. There is an urgent need for a coordinated approach to protect consumers, ensure transparency, and promote responsible business practices. We aim to engage with different ministries in our capacity to drive caution and request for intervention against these platforms.” said Mr. Abhishek Kumar, Convener, NICI.

The workshop also explored how opinion trading platforms could influence real-world events if left unregulated.

Industry experts referenced regulatory frameworks in countries like Singapore, the European Union, and the United States. These regions have stringent policies in place to safeguard consumers from financial exploitation. The discussion underscored the need for a regulatory framework in India to curb misleading promotions and reduce financial vulnerabilities.

Stakeholders Call for Immediate Action

The workshop was attended by several consumer rights advocates and industry leaders, including:

• 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. R D Usmani, Director, Indian Institute of Technology & Entrepreneur Development
• Poonam Sharma, President, Rashtriya Sammudeshya Vikas Sansthan
• Takshit Mathur, Tech Entrepreneur

Rijit Sengupta highlighted the responsibility of businesses and investors to consider societal impacts. He suggested that regulatory bodies like the Reserve Bank of India (RBI) should also monitor transactions on these platforms. Shipra Mathur pointed out that despite international regulations, India has yet to address the risks associated with opinion trading.

Next Steps Towards Regulation

The session concluded with a call for stronger policy measures to safeguard consumers. Participating organizations agreed on the need for coordinated efforts to engage with regulators. NICI and PEN Media Literacy plan to submit joint representations to key regulatory bodies, including:

• Ministry of Consumer Affairs
• Ministry of Information & Broadcasting
• Ministry of Finance
• Securities and Exchange Board of India (SEBI)
• Advertising Standards Council of India (ASCI)

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