Study Finds 95% of India's Listed Companies Use Dark Patterns, Pushes SEBI to Act
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A new study has found that an overwhelming majority of India's listed companies running online platforms use manipulative design tricks to influence how customers shop, pay, and even cancel services. The study, conducted by community platform LocalCircles, found that more than 95 percent of publicly listed companies involved in online consumer transactions used at least one such trick during the buying, transaction, or refund process.
These manipulative tricks are commonly known as dark patterns. They include things like sneaky pricing that hides extra charges until the final step, confusing subscription renewals that are hard to cancel, fake urgency messages pushing people to buy quickly, and default settings that quietly opt users into things they didn't choose. The study analysed consumer complaints and used an AI-based detection tool to scan over 300 platforms across a year.
Only a handful of listed companies, including Meesho, Jockey, Hamleys, Eco Mobility, and EasyMyTrip, were found to be completely free of these deceptive practices. The study also looked beyond listed firms and checked companies that had voluntarily declared themselves dark-pattern-free to the Central Consumer Protection Authority. Out of 23 such companies, only seven actually lived up to that claim, raising doubts about how reliable self-declared compliance really is.
The findings point to a bigger problem: sectors like digital lending, e-commerce, online banking, food delivery, travel, and online gaming showed seven or more types of dark patterns each. The most common trick overall was hidden or misleading pricing, found on nearly two-thirds of platforms studied, followed by confusing interface designs and bait-and-switch tactics that lure users with one offer before switching terms.
This comes at a time when India's markets regulator, the Securities and Exchange Board of India, has proposed a new Common Advertisement Code for 2026. The draft rules aim to ban dark patterns in investment-related communications, such as fake urgency claims, hidden fees, misleading default settings, and disguised advertisements. It would also stop companies from using cashback offers or free trading vouchers just to lure people into trading more or downloading apps.
The LocalCircles study welcomed this proposed code as a good starting point but argued it should go further. It called on SEBI to make sure all companies that are listed, or want to get listed in India, are completely free of dark patterns in their digital operations, not just in their advertisements. The study also shared a proposed self-declaration framework that listed companies could use to certify they are dark-pattern-free before regulators.
The bigger message from the study is that voluntary self-checks are not working well enough, since most companies that claimed to be clean weren't. This has strengthened the case for an independent verification system, rather than trusting companies to police themselves.
With SEBI's new advertisement code still in the consultation stage, the coming months could decide how strict future rules will be, and whether India moves toward mandatory audits of companies' digital practices rather than relying on self-reported compliance.
Why it matters
Dark patterns quietly manipulate millions of everyday users into paying more, agreeing to unwanted subscriptions, or making rushed decisions online, often without realising they are being misled. Since these tricks are found across almost every major listed company's digital platform in India, from e-commerce to banking to travel, they affect nearly every internet user's daily transactions. The study's findings expose weaknesses in India's current self-regulation approach and add pressure on SEBI to enforce firmer, verifiable standards, which could reshape how companies design apps, websites, and investor communications going forward.
Test yourself
1. What percentage of India's listed companies with online platforms were found to use dark patterns, according to the LocalCircles study?
2. Which organisation conducted the study on dark patterns among Indian companies?
3. Which of the following companies was identified as being free of dark patterns in the study?
4. Out of 23 companies that self-declared themselves as dark-pattern-free to the CCPA, how many actually met that standard?
5. What is the Common Advertisement Code (CAC) proposed by SEBI meant to regulate?
6. Which dark pattern was found to be the most common across platforms studied?
7. Which sector was NOT listed among those with seven or more types of dark patterns?
8. What kind of promotional inducements does the CAC aim to ban?
9. What tool did LocalCircles use to screen companies for dark patterns?
10. What broader issue does the study highlight about the current self-audit system for dark patterns?
Your notes
Source: The Indian Express