Wellington, April 18, 2021
The Financial Markets Authority (FMA) has provided transitional licence numbers under the new financial advice regime, revealing how many financial advice providers are operating in New Zealand.
The geographic profile follows the start of the new financial advice regime last month.
An FMA infographic shows that there are more than 3000 financial advice businesses (comprising 1807 Financial Advice Providers and 1200 Authorised Bodies), which are engaging 10,743 financial advisers and 12,287 nominated representatives.
FMA Director of Market Engagement John Botica said, “These statistics provide a snapshot of the financial advice sector and highlight the continuing presence of small advice businesses, with 82% of financial advice providers being businesses with fewer than 10 financial advisers spread right across New Zealand.”
Personal Risk Insurance (such as life insurance) accounted for the largest share of financial products of Advisers (70%), followed by KiwiSaver and mortgage products and consumer credit contracts.
More than half of financial advice providers are based in Auckland, although these businesses may have advisers throughout the country, followed by Canterbury.
Mr Botica said that the next crucial step for financial advice providers is to ensure that they formally record details of the advisers that they have engaged by linking to them on the Financial Service Providers Register (FSPR).
“Financial advisers who are not linked to a financial advice provider by 16 June 2021 may face deregistration,” he warned.
Full instructions about the linking process are on the Companies Office website.
About the New Financial Advice Regime
The New Financial Advice Regime came into force on March 15, 2021.
Providers of financial advice and their advisers must now (a) Have a transitional licence and be able to comply with its standard conditions (b) Comply with new duties under Part 6 of the Financial Markets Conduct Act 2013 (c) Comply with the new Code of Professional Conduct for Financial Advice Services (d) Provide the prescribed disclosures (e) Financial advice providers have a two-year transitional period, by the end of which they must hold a Financial Advice Provider full licence.
The FMA is now accepting applications for full licences.
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