India’s Warning to Ed Tech: Fix False Advertising or Face ‘Stringent’ Guidelines

Staff Writer

Education technology companies in India have received a warning from the government: Stop with unfair trade practices and false advertising or face new, “stringent guidelines.”

The message was delivered earlier this month, during a meeting between India’s Department of Consumer Affairs Secretary Shri Rohit Kumar Singh and the India Edtech Consortium, a self-regulatory body, according to a statement released by the government afterward.

Discussion during the meeting focused on unfair trade practices and misleading advertisement in the country’s ed tech sector, including an increasing number of fake reviews of products or companies.

They noted that a recent report by the Advertising Standards Council of India found the largest violator of advertising code in 2021-22 was the education category.

The consumer affairs secretary Shri Singh called on the consortium to better manage consumer interests and work to maintain robust checkpoints. Otherwise, the government would impose new guidelines “for ensuring transparency,” the statement said.

Members of the consortium of ed-tech providers in attendance at the government meeting included Byju’s, upGrad, Unacademy, Vedantu, Great Learning, WhiteHat Jr., and Sunstone, according to the statement.

Byju’s has sought to expand in the North American market and has won the backing of numerous investors, bringing its estimated valuation to $22 billion. Neither the India Edtech Consortium or Byju’s responded to EdWeek Market Brief’s request for comment.

The government’s announcement received considerable attention in the media in India, making headlines as the latest crackdown on alleged unfair business practices.

Center of Investment

India is one of the most closely watched ed-tech markets in the world.

Over the past several years numerous digital companies have been launched in the nation of 1.3 billion, attracting venture capital and offering an array of tech-based education products, many of them designed to serve parents seeking better educational opportunities for their children.

Additionally, some foreign-based companies have sought to make inroads in India, a sprawling educational landscape in which there are more than 20 official languages and an estimated 250 million students, many of them in private schools. 

Over the last decade, between 2010 and 2021, India invested $7.9 billion in education, only surpassed by China and the U.S., according to a recent report by  global research and intelligence firm Holon IQ.

In 2021, India invested $3.8 billion, according to Holon IQ, while the U.S. invested $8.3 billion.

Investment in another huge education market, China, collapsed in 2021 following new government-initiated regulations that generally banned the use of foreign education materials in Chinese public schools and in many cases shut down for-profit tutoring — dampening enthusiasm in the country’s enormous market.

Follow EdWeek Market Brief on Twitter @EdMarketBrief or connect with us on LinkedIn.

Image by Getty

See also: