SEBI Urged to Stop Dark Patterns on Indian Online Platforms to Protect Consumers

According to a new study conducted by LocalCircles, dark patterns remain a major issue on many Indian web platforms. According to the report, more than 95% of listed companies that offer online services continue to use dark patterns that can affect client decisions. The findings have also resulted in a new recommendation to SEBI to make dark pattern-free digital platforms a condition for all companies wanting to list in India.

How Online Platforms Use Dark Patterns to Influence Users

Dark patterns are design tricks used on websites and apps to convince people to do things they may not want to do. Hidden charges, confusing cancellation options, subscription traps, deceptive pricing, fake urgency, and repetitive pop-ups that urge users to make rapid decisions are some instances.

The study evaluated over 300 online platforms utilizing consumer complaints gathered over the previous year and an AI-based dark pattern identification technique. While many businesses involved in these techniques, a select platforms, such as Meesho, Jockey, Hamleys were determined to be free of dark patterns. The report also found that self-certification is not enough. Out of 23 companies that claimed they were free from dark patterns after conducting their own audits, only seven actually met the required standards. This shows that stronger checks and independent verification are needed to protect consumers.

SEBI Guidelines Aim to Improve Online Transparency

LocalCircles has proposed that the Securities and Exchange Board of India (SEBI) mandate all listed companies and those intending to go public to declare that their websites and apps are free of dark patterns.

The recommendation comes after SEBI proposed the Common Advertisement Code (CAC) for 2026. The proposed regulation seeks to eliminate deceptive online tactics such as hidden costs, subscription traps, fake urgency, misleading default settings, disguised marketing, and cashback rewards that induce excessive financial decisions. It also establishes stronger guidelines for influencer promotions and investor advertising.

Which Sectors Are Most Affected?

The study found that areas such as e-commerce, online banking, food delivery, OTT platforms, travel, digital lending, and online gaming have the most dark patterns. Drip pricing, interface interference, disruptive notifications, and subscription traps were among the most frequently used tricks across hundreds of platforms.

The study concludes that stronger regulations and regular monitoring are required to increase transparency and user trust. As online shopping and digital services expand in India, eliminating dark patterns would enable users to make better, more informed decisions.

This article is based on information from The Indian Express