[GRTV] How to get better access to advice
Watch FMA Director of Deposit Taking, Insurance, and Advice Michael Hewes talks about access to financial advice, what the regulator can do and the role stakeholders play.
Comments
by Backstage
Without writing a "thematic" the message appears to be Advisers and Adviser firms have been terrified of regulatory risk and potential FMA enforcement , so they default to performing exhaustive, multi-step financial plans for simple situations.
This makes advice commercially unviable for average consumers and locks out critical, underserved segments.
I like Michaels message and feel this needs to be shouted to many firms for a few months as this message will evaporate as the report has.
Trivia, has Michael ever been in a conversation where "thematic" hasn't been used?
This makes advice commercially unviable for average consumers and locks out critical, underserved segments.
I like Michaels message and feel this needs to be shouted to many firms for a few months as this message will evaporate as the report has.
Trivia, has Michael ever been in a conversation where "thematic" hasn't been used?
by valkyrie6
We want more people to get access to financial advice.
So recently an aggregation group told its members that anyone with their own FAP license will now have their monthly membership fees increased, and members that cancel their FAP license and go under the group one will not have an increase.
The also said that product providers( banks and lenders ) and regulators (FMA) also want more advisers to go under one FAP license , the groups can impose their own compliance programs and dictate the cost of them programs to its members as essentially they have a monopoly over mortgage advisers whom if they don’t belong to a Aggregation group they can’t access bank products so they have no business, hence the term Monopoly.
Advisers choose to have their own FAP license and are also free to choose where they get their compliance programs from, so they also have a choice on the cost even though they still have to belong to an aggregation group to access bank products.
The problem here is that aggregation groups are forcing FAP license holders to comply with their group FAP license compliance requirements, essentially an FAP under a FAP (at time and cost to the adviser FAP) a cost that the group controls.
So essentially, adviser FAP license holders are trying to meet compliance requirements from 3 different sources, direct from banks, direct from the FMA, and direct from aggregation groups.
Over regulation will drive advisers out of the industry and certainly not grow it.
How does this give more people access to financial advice? it doesn’t.
So recently an aggregation group told its members that anyone with their own FAP license will now have their monthly membership fees increased, and members that cancel their FAP license and go under the group one will not have an increase.
The also said that product providers( banks and lenders ) and regulators (FMA) also want more advisers to go under one FAP license , the groups can impose their own compliance programs and dictate the cost of them programs to its members as essentially they have a monopoly over mortgage advisers whom if they don’t belong to a Aggregation group they can’t access bank products so they have no business, hence the term Monopoly.
Advisers choose to have their own FAP license and are also free to choose where they get their compliance programs from, so they also have a choice on the cost even though they still have to belong to an aggregation group to access bank products.
The problem here is that aggregation groups are forcing FAP license holders to comply with their group FAP license compliance requirements, essentially an FAP under a FAP (at time and cost to the adviser FAP) a cost that the group controls.
So essentially, adviser FAP license holders are trying to meet compliance requirements from 3 different sources, direct from banks, direct from the FMA, and direct from aggregation groups.
Over regulation will drive advisers out of the industry and certainly not grow it.
How does this give more people access to financial advice? it doesn’t.
by w k
@valkyrie6, for the aggregation group, I see conflict of interests. Here's where FMA could step in.
Members who have their own FAP should leave this aggregator, unless they are also doing lending biz where they have no choice.
All I can say is that most compliance "experts" in aggregator groups just added extra layers of "compliance" to create fear in advisers to be their own FAP. Cannot blame FMA.
It's not that difficult to be your own FAP, just that I suspect many advisers lacked the confidence.
Members who have their own FAP should leave this aggregator, unless they are also doing lending biz where they have no choice.
All I can say is that most compliance "experts" in aggregator groups just added extra layers of "compliance" to create fear in advisers to be their own FAP. Cannot blame FMA.
It's not that difficult to be your own FAP, just that I suspect many advisers lacked the confidence.
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