Political Finance has entered the digital age - now regulators must follow

International IDEA’s recent report “Political Finance in the Digital Age: Towards Evidence-Based Reform” warns that while online political campaign is exploding in scale and complexity, regulatory frameworks remain outdated. Drawing on 13 country case studies from across the globe, the report highlights the main challenges and identifies best practices and possible solutions. 

The political landscape is undergoing a profound transformation as campaigns surge through social media feeds, boosted by algorithms and bots, putting a stress test on electoral integrity and transparency of political finance. From Brazil to Belgium, Nigeria to India, increasing amount of money is spent on digital platforms and tools to target voters and shape narratives. But campaign finance laws haven’t caught up. As political parties and candidates pivot towards digital platforms to reach and persuade the electorate, the rules meant to ensure transparency in political finance are lagging dangerously behind. The question is no longer whether to regulate online campaigning—but how. Should digital activity be mainstreamed into existing campaign finance laws, or should they be governed by new regulatory framework? Should regulation focus on political actors, platforms, or both? And should oversight rely on binding legal frameworks or voluntary codes of conduct? These are some of the aspects that the report explores, sharing insights and lessons from experiences of countries that have experimented with distinct models. 

Semantic gaps: Ambiguous and outdated legal definitions

In many countries, the definitions of electoral campaigning or political advertisements are often outdated and ambiguous. Regulatory definitions often fail to capture the rapidly evolving forms of online political communication, creating loopholes that can be exploited. For example, Montenegro's media law, focused on editorial oversight, does not apply to social media, leaving it unregulated. Chilean law distinguishes between promotional activities and 'disseminating ideas or information on political acts', creating a legal grey area that requires the oversight body to interpret messages on a case-by-case basis. Yet, some recent regulatory changes could provide a source of inspiration. The European Union has adopted a wide-ranging and broad definition of political advertising, encompasses both online and offline political advertisements from all individuals and organisations (so not only political parties or candidates), both during and outside of electoral periods. Latvia has adopted a hybrid approach that integrates existing robust campaign finance provisions with new specific rules for online campaign activities.

Shadow campaigns: The influence of third-party actors

Third-party campaigning is also major hurdle. Political actors often frontload spending or use unregulated third-party actors to avoid caps or transparency requirements. This means that anyone who is neither a political party nor a candidate can place political advertisements or campaign on social media in support or against a political party or a candidate, without necessarily complying with the rules governing political finance. In India, much of the expenditure on digital platforms have been found to be coming from sympathizers or affiliated groups rather than directly from parties or candidates, often escaping liability due to weak provisions. This regulatory gap becomes even more worrisome when foreign entities exploit it to influence domestic elections. Through paid digital ads, sponsored content, or coordination with local intermediaries, external actors can funnel resources and narratives into national campaigns without detection.

Campaigning by chat: The rise of messaging apps

One of the most significant trends outlined in the report is the growth of instant messaging applications (IMAs) such as WhatsApp, Telegram and Signal as tools of political communication, which often escapes the public eye. While most don't allow paid advertising, they are powerful campaign tools, particularly for coordinated mass messaging and the rapid spread of disinformation. In countries like India and Brazil, IMAs have become indispensable for mobilizing supporters, spreading campaign materials, and increasingly, running micro-campaigns in targeted communities. Unlike public social media platforms, content shared via IMAs is encrypted, making it nearly impossible for oversight bodies—or even platforms themselves—to track funding, origin, or accuracy.

Behind the feed: The new political middlemen

The increasing reliance on influencers and digital marketing firms in political campaigns adds further complexity. Payments to these individuals and companies are often hidden, enabling them to mimic their content as organic campaigning. As the report notes, these actors frequently fall outside of existing regulatory frameworks, creating a loophole where significant political influence can be bought without accountability. The USA struggles with hidden financial transactions with influencers, sometimes channelled through "dark money" groups that obscure funding origins. The use of digital intermediaries in Albania has also allowed for social media expenditures to be obscured in official reports.  

The Solution: A framework that works for the digital era

The report offers a pragmatic, evidence-based roadmap:

• Require all online political ads—across platforms and formats—to clearly disclose the sponsor, the amount spent, the buyer of the ad, the relevant election or referendum, and targeting criteria. Public ad libraries must be standardized, searchable and accessible in real time. The EU has set precedent by legally requiring major platforms to disclose political ad data, moving from soft laws to enforceable standards.

   

• Bring third parties within the legal framework by compelling them to register, report spending and follow donation rules, and establish clear rules for influencers, consulting firms and PR agencies. Canada provides a strong model, with strict limitations and disclosure requirements for third-party campaigners.

   

• Equip oversight bodies with digital skills and technical tools for social media analysis, data audits, and real-time ad monitoring. Facilitate data sharing between platforms and authorities to cross-verify spending. Ireland has introduced a robust reform which empowers the Electoral Commission to monitor online political advertising, monitor online platforms, monitor buyers of online political advertising, and educate, investigate and enforce compliance.

   

• Empower and support civil society watchdogs and journalists with access to open data, training in digital forensics, cybersecurity and protections that enable them to play a frontline role in campaign finance transparency. User-friendly tools, such as India's cVIGIL app, which allows citizens to report infringements, can significantly enhance monitoring efforts and can foster a collaboration between civil society and the official monitoring bodies to safeguard democracy in the new digital era.