RISE OF THE
FINFLUENCERS

The popularity of these 10-20 minute-long videos is explained by India’s low financial literacy rate of 27 per cent, according to the National Centre for Financial Education’s 2019 survey. So naturally, first-time investors, especially from far-flung towns and cities, are drawn to these finfluencers. This also explains why some of their most-viewed videos are “How to buy your first share”, “Get regular income from gold”, or even “Earn 2.5 crores in 20 years! How?”

---

Retail powers the rise of finfluencers

Retail investors’ share in cash market turnover (%)

---

The finfluencer phenomenon isn’t limited to India. According to a report by Statista, a German firm specialising in market and consumer data, the global market size of influencers — those who talk about fashion, gadgets, health, beauty and finance on social media — has surged eightfold in just five years, rising from a mere $1.7 billion in 2016 to nearly $14 billion in 2021. More tellingly, the market size has more than doubled from $6.5 billion in 2019.

These two years also saw an explosion in the popularity of finfluencers in India as millions of new investors entered the market. Trading was democratised as new-age broking firms built easy-to-use apps. Affordable smartphones, cheap data plans and ubiquity of digital payments helped. However, these new investors lacked the knowhow. And the 24/7 business news channels weren’t exactly helpful.

“If you look at most business news channels, they primarily focus on market updates, while the new investor needs education,” says Kamra. He says finfluencers are filling the vacuum of financial literacy. Kamra, who likes to be casually dressed in a tee in most of his videos, adds that most influencers prefer YouTube. “For a content provider, YouTube comes with a lot of tools to control how and to whom the content is highlighted,” he says.

The popularity of India’s top finfluencers is clear from the fact that they have more YouTube subscribers than new-age broking firms like Zerodha, Groww, Upstox and 5Paisa as well as traditional ones like IIFL, Kotak Securities, ICICI Direct and Angel Broking. Even popular western finfluencers — like Anthony O’Neal, My Fab Finance, Mr Money Mustache, The Budgetnista and Mrs Dow Jones — have a few thousand, or at best three to four lakh, subscribers. But nowhere near a million (or ten lakh) like their Indian counterparts. Such is their growing popularity in India that leading broking firms are engaging these YouTube stars to reach out to potential investors.

The high subscriber count has resulted in a financial windfall for Indian finfluencers, especially the ones with million-plus followers. While their videos are free to view, a financial influencer, like those in other categories, has multiple streams of income like Google advertisements, collaborations and partnerships. All these streams can add up to lakhs in earnings. One estimate pegs the figure at upwards of Rs 15 lakh a month.

“Once you have got more than a million followers and are making videos on a weekly basis while also engaging with broking firms, the monthly earnings can be anywhere between Rs 15 lakh and Rs 30 lakh,” says a broking firm executive who often engages top finfluencers. This is corroborated by three others, including a finfluencer, none of whom wants to be named.

But to hit those lakhs in earnings, they need millions of followers. And that isn’t easy.

Who Wants To Be A Millionaire?

Mukul Malik started his YouTube channel, Asset Yogi, in August 2017, mostly focusing on real estate. But, the 39-year-old tasted success only after he pivoted towards topics like the stock market and personal finance. The Delhi-based MBA still remembers how he got his first 500 followers.

“It was mostly friends and family. I still remember it took me around three months to get to 1,000 followers, but the next three saw around 10,000 additions. The last year or so has been great in terms of followers as demand for information relating to financial instruments and stock markets has soared,” he says.

Similarly, Ranade started her YouTube sojourn in 2009 by posting videos for her students. It took her channel nearly a year-and-a-half to hit the magic mark of one million, and that happened only after she shifted to making videos on capital markets in February 2019. It took her just seven months to get the next set of one million followers.

Ranade says the pandemic was a strong catalyst for the rise of finfluencers. “The lockdown last year gave people more time to look at their finances and financial planning in particular. Job losses and salary cuts were rampant and people started looking at other sources of income, which brought them to YouTube for informative content,” she says.

But to keep those subscribers coming back, YouTubers also have to post content regularly. Ranade follows a strict schedule. She posts 8 to 10 videos every month — one each on Wednesdays and Saturdays. She also does one live stream each week where she interacts with her viewers.

While Kamra, Ranade and Malik are bonafide YouTube stars, having already crossed the one million follower mark, there are others who are closing in on the milestone. Parimal Ade, P.R. Sundar and Ankur Warikoo are among those who have crossed the half-way mark. And, if their recent pace of getting followers is anything to go by, they will be a part of the one million club sooner rather than later.

Warikoo, who hails from Faridabad, focuses more on financial planning and personal finance rather than stockspecific content, for his 6.98 lakh subscribers. He believes the young generation always looked at YouTube as a platform for learning and the pandemic made the demand explode. “The youth have used YouTube for their school homework, for their college assignments and for learning new skills like coding. So, the demand always existed. I think what changed in the pandemic was the supply,” says the 40-year-old who is also the founder of food and shopping discovery platform nearbuy.com.

Content is King

The quality of the supply, however, is of paramount importance. The rules for good content aren’t too different from those for good journalism: it has to be informative, easy to understand and unbiased. This combination, say influencers, will lead to views and likes and ultimately translate into subscribers.

Take Varun Malhotra. The 39-year-old says his videos are primarily focused on explaining financial concepts to his 3.7 lakh followers rather than informing them about a particular stock. “I am completely into educating the viewer. My channel airs only financial education videos as there are a large number of investors who want to learn the concepts of investing,” says Malhotra, whose most popular videos have been on mutual funds.

In fact, most finfluencers play it safe by focusing more on the concepts and fundamentals of stock market investing and financial planning instead of giving advice on what to buy or sell. Some are also registered with the Securities and Exchange Board of India (SEBI) as Registered Investment Advisors. In most cases, they even suggest that investors consult their financial advisor before taking the plunge.

There are some, though, who have amassed a sizeable following by creating a niche. Like 57-year-old Sundar. The former mathematics teacher, who is one of the top futures and options (F&O) traders in the country, makes videos on strategies relating to the derivatives market for his nearly 6.45 lakh YouTube subscribers.

“I am an F&O trader myself and more specifically an options seller. No channel talks about options selling. I believe in talking about what I know and hence talk about derivatives. This is also the reason that, unlike most other channels, I have many HNIs (high net worth individuals) as followers; 10 per cent of my followers are from outside India,” says the Chennai-based financial influencer.

Clearly, the focus is on improving financial literacy. In fact, the most-viewed finfluencer videos are on topics like the basics of stock market investing, personal finance, creating a retirement corpus, mutual funds and other such subjects. Their effort towards improving the investment culture earns them the trust of their audiences. This is especially crucial if an influencer also happens to be collaborating with broking firms or brands.

“Credibility is the key,” says Malik. “We have to be ethical. If we are talking about a product or service, we have to talk about the risks as well. It cannot be one-sided. The content needs to be presented in a manner that is a win for the audience, the brand and the influencer. Only if it checks all the three boxes will I do a video that is sponsored by someone.”

After all, sponsorships are one way to rake in the big bucks.