IMPACT OF FINFLUENCERS’ CONTENT ON RETAIL INVESTMENT DECISIONS

Abstract

In India, the rise in digital platforms and the popularity of smart phones has significantly transformed the financial landscape for retail investors, impacting access to information and investment choices. The introduction of ‘finfluencers' — or “financial influencers” — has created a new tide of content creators who are influencing retail investors' awareness, attitudes, and behaviors. This study aims to analyze the impact of the finfluencer content on the financial literacy, the investment behaviour of the retail investors, the moments of investment decision making among the retail investors of India with special attention to the factor of trust, investment credibility, content consumption style, and previous investment experiences. The research used in this study is exploratory research, the data sources used are primary and data collection techniques used is structured questionnaire that is managed to respondents using Google forms. Descriptive statistics, frequency distributions and cross-tabulation were used to analyze a convenience sample of 98 retail investors who actively follow financial content on various platforms like YouTube, Instagram, and Twitter/X. The results show that finfluencer content has had a direct or indirect impact on at least one investment decision for 68.4% of the respondents, with YouTube (41.8%) and Instagram (28.6%) being the most prevalent platforms where financial content is consumed. Most respondents (63.3%) found finfluencers moderately or highly credible, with the quality, transparency and disclosure of the content cited as the most important elements that help build trust, whereas numbers of followers was found to be relatively unimportant. Finfluencer content has played a significant role in online educational skills, with a significant 78.5% of respondents noting some financial literacy improvement due to this content that is understandable, regardless of how limited their involvement with it was. We found that investment experience is a key influence that affects people's susceptibility to finfluencer content, with the (58%) novice investors with less than one year of investing experience being much more likely to implement the recommendations from the finfluencer than the (12%) investors with more than five years of experience. Finfluencers have noticeable potential to increase financial knowledge and financial inclusion, yet the study also outlines issues with their herd mentality and financial knowledge that is not adequate or inclusive of other 1 viewpoints. In line with these concerns, a majority (66.4%) of the respondents agreed to have the regulatory watch on finfluencers by SEBI. The study ends with the recommendations for the retail investors, finfluencers, and legislators and policymakers to create a more responsible and transparent digital financial market in the country.