Government warns ed-tech companies against unfair trade practices

The central government on Friday warned ed-tech companies against unfair trade practices, saying that if self-regulation does not curb such practices, then stringent guidelines would be formulated for ensuring transparency.

Department of consumer affairs secretary Rohit Kumar Singh conveyed this at a meeting in New Delhi with self-regulatory body India Ed-tech Consortium (IEC), which runs under the aegis of Internet and Mobile Association of India (IAMAI).

The meeting was attended by representatives of IAMAI, along with IEC member companies, including upGrad, BYJU’S, Unacademy, Vedantu, Great Learning, WhiteHat Jr and Sunstone. The IEC comprises of Indian start-ups and represents 95 per cent of the Indian learner community.

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Guarding consumer interests

During the meeting, issues pertaining to unfair trade practices and misleading advertisement for the ed-tech sector figured prominently, a statement released by the consumer affairs ministry said adding, the secretary discussed ways to better manage consumer interests across India’s ed-tech ecosystem.

“As part of the agenda, members discussed the need to further enhance the Indian ed-tech ecosystem to better safeguard consumer interests, through seamless, transparent, and feasible offerings for consumers.” The statement said.

In December last year, the government issued an advisory to citizens regarding the use of caution against ed-tech companies which support online and remote learning. The education ministry advised parents, students and all stakeholders in education to exercise caution when deciding to use online content and coaching provided by domestic ed-tech firms.

Concern over misleading ads

The secretary pointed out that it has been reported that certain advertisements and practices do not seem to conform to prevalent guidelines and existing regulations. The problem of increasing fake reviews was also a major point of concern “which needed to be contained”. Notably, a recent report by ASCI revealed that education category is the largest violator of advertising code in 2021-22.

According to the consumer affairs ministry, any advertisement or promotion through television, radio, or any other electronic media, newspapers, banners, posters, handbills, wall-writing, etc, to misrepresent the nature, characteristics, qualities or geographic origin of goods, services or commercial activities so as to mislead the consumer could be broadly defined as a misleading advertisement.

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Last month, the government came out with new guidelines to prevent misleading advertisements, including those targeting children and making free claims to woo consumers. The guidelines also specify due diligence to be carried out while endorsing in advertisements.

The industry members briefed the Secretary about the progress of the IEC and the direction of ongoing efforts to improve awareness and welfare of learners.