Quick answer: Direct selling in India is growing steadily but modestly. Industry sales reached ₹23,021 crore in 2024-25, up about 4% on the previous year, with roughly 93 lakh active direct sellers, according to the Indian Direct Selling Association (IDSA). Since 2021 the sector has been regulated by the Consumer Protection (Direct Selling) Rules, 2021, which ban pyramid and money circulation schemes. Before you join any company, check that you will earn from selling products, not from recruiting people.
What is direct selling?
Direct selling is a way of marketing and selling goods or services directly to consumers away from shops, through independent representatives called direct sellers. They sell through personal contact, home demonstrations or online. Many direct selling companies use a multi-level (network) model, in which sellers can also earn a commission on sales made by people they bring in.
That model is legal in India only when earnings come mainly from genuine sales of products to consumers. When income depends mainly on recruiting new members and collecting their joining money, it becomes an illegal pyramid or money circulation scheme.
How big is the direct selling industry in India?
The IDSA’s annual survey, prepared with Ipsos and released in May 2026, reported:
| Measure | Figure |
|---|---|
| Gross sales, 2024-25 | ₹23,021 crore (up about 4% on ₹22,142 crore in 2023-24) |
| Gross sales, 2019-20 | About ₹16,800 crore |
| Growth since 2019-20 | Compound annual growth of about 6.5% over six years |
| Active direct sellers | 93.2 lakh (up from 88 lakh) |
| Share of women among direct sellers | 48% |
| Largest product category | Wellness and nutraceuticals, nearly 60% of sales; cosmetics and personal care 26% |
What happened to the “₹645 billion by 2025” forecast?
An earlier version of this article said direct selling in India would reach ₹645 billion (₹64,500 crore) by the end of 2025, and that the industry had “tripled” to more than ₹200 billion in five years. The ₹64,500 crore figure was a projection from a FICCI-KPMG study released in 2014, which also estimated that the industry could provide self-employment to about 18 million people. The industry’s actual 2024-25 sales of about ₹23,000 crore were roughly a third of that forecast. Sales of about ₹16,800 crore in 2019-20 were also well short of the ₹200 billion (₹20,000 crore) the article claimed. Industry forecasts are not guarantees, and this one was far too optimistic.
Direct selling in the United States
The original article also said US direct selling generated $44 billion in 2019 and created 0.84 million jobs. The US Direct Selling Association’s survey reported $35.2 billion in retail sales for 2019 and 6.8 million direct sellers. Most direct sellers are independent contractors rather than employees, and many sell part-time.
The rules: Consumer Protection (Direct Selling) Rules, 2021
The central government notified the Consumer Protection (Direct Selling) Rules, 2021 on 28 December 2021 under the Consumer Protection Act, 2019. They replaced the advisory Direct Selling Guidelines of 2016, and existing companies had 90 days to comply. Key points from the government’s announcement:
- Both direct selling companies and direct sellers are prohibited from promoting or joining a pyramid scheme or a money circulation scheme in the name of direct selling.
- A direct selling entity must be incorporated in India (as a company, partnership or LLP) and have at least one physical registered office in India.
- It must file a self-declaration that it complies with the Rules and is not running a pyramid or money circulation scheme.
- It must have a written contract with each direct seller on just, fair and equitable terms, verify sellers’ identities and addresses, and issue identity cards only to verified sellers.
- It must publish its registered name and address, grievance officer contacts, return, refund, exchange and warranty policies, and full prices on its website, and give each complaint a ticket number.
- It is liable for complaints arising from goods or services sold by its direct sellers.
- Every state government must set up a mechanism to monitor direct sellers and direct selling companies.
- Companies and sellers that sell through e-commerce must also follow the Consumer Protection (E-Commerce) Rules, 2020.
Money circulation schemes are also banned under the Prize Chits and Money Circulation Schemes (Banning) Act, 1978.
Direct selling vs pyramid scheme: how to tell the difference
| Legitimate direct selling | Pyramid or money circulation scheme |
|---|---|
| You earn mainly from selling products or services to real customers | You earn mainly from recruiting people and their joining payments |
| No large joining fee or investment | Large joining fee, “starter kit” or investment required |
| Return, buy-back or cooling-off option for unsold stock | No right of return, buy-back or cooling-off |
| Company details, grievance officer and policies published on its website | Vague company details; pressure to “join before the offer closes” |
| Realistic talk about part-time income | Promises of high commissions, foreign trips and quick wealth if you recruit |
The three warning signs in the second column (large joining fee or investment, pay for recruiting, and no return, buy-back or cooling-off) are the ones the Central Consumer Protection Authority (CCPA) highlighted in December 2024, when it issued notices to 17 direct selling entities for alleged violations of the Rules. The CCPA advises consumers to check a company’s disclosures (certificate of incorporation, PAN, GST registration, trademark registration and licences), read contracts carefully and deal only with sellers who carry valid identity cards.
Pyramid schemes are one of the most common money-making scams. Our guide to legitimate ways to make money online, and scams to avoid covers others.
Will direct selling keep growing?
The original article argued that the best time to join an industry is during its growth stage. It described five stages of an industry life cycle: start-up, growth, shakeout, maturity and decline. That framework is useful: companies that fail to adapt to change can decline quickly. The original’s example was Nokia, which lost its lead in mobile phones after the shift to smartphones and sold its phone business to Microsoft in 2014.
On the IDSA’s own figures, Indian direct selling is growing, but slowly, at about 4% in 2024-25 and about 6.5% a year since 2019-20. The original article also named government programmes (Digital India, Startup India, Make in India, Skill India and women’s empowerment schemes) as drivers. These are real programmes, but none of them is specifically a direct selling scheme, and the government’s main role in this sector is regulating it.
The earlier version of this article also named a company, Subhotam Multitrade Pvt Ltd, as an example of a fast-growing direct selling business and quoted its “experts”. We could not verify any of those growth claims, so they have been removed. This article does not recommend any company.
Before you join a direct selling company
- Check the company’s disclosures on its website: registered office in India, incorporation details, grievance officer and return or buy-back policy, as the 2021 Rules require.
- Ask how you will earn. If most of the income in the plan comes from recruiting rather than from product sales, walk away.
- Avoid big upfront payments. Do not pay a large joining fee or buy stock you cannot sell or return.
- Treat income claims with caution. Ask for written details of what typical sellers earn, not the top earners.
- Treat it as a business. You will need customers, time and marketing. Our tips on marketing a small business online and growing a small business apply here too.
- Report suspected pyramid schemes to the National Consumer Helpline (1915 or consumerhelpline.gov.in) or the police.
This article is general information, not financial or legal advice. Rules and company practices change, so check the Department of Consumer Affairs website before you sign up or pay.
Frequently asked questions
Is direct selling legal in India?
Yes. Direct selling is legal and is regulated by the Consumer Protection (Direct Selling) Rules, 2021. Pyramid schemes and money circulation schemes are illegal.
Is multi-level marketing (MLM) the same as a pyramid scheme?
Not necessarily. A multi-level plan is allowed if earnings come mainly from selling products to consumers. It becomes an illegal pyramid scheme when income comes mainly from recruiting people and their joining payments.
How big is the direct selling industry in India?
About ₹23,021 crore in gross sales in 2024-25, with 93.2 lakh active direct sellers, according to the IDSA’s survey with Ipsos.
Can a direct selling company charge a joining fee?
A large joining fee or investment is one of the warning signs of a disguised pyramid scheme highlighted by the CCPA. Be very cautious of any company that asks for one.
Where can I complain about a direct selling company?
First complain to the company’s grievance officer, whose details must be on its website. If that does not work, contact the National Consumer Helpline or file a complaint with the consumer commission.
This article was checked in October 2026 against the government’s notification of the Consumer Protection (Direct Selling) Rules, 2021, the CCPA’s December 2024 advisory, the IDSA-Ipsos industry report (May 2026) and the US Direct Selling Association’s 2019 figures.
