Financial Planners BEWARE!

National Credit Code indicates that you might need a Credit Licence…

Financial planners will often provide budgeting and debt management advice when providing personal financial advice. This could well involve considering particular credit products or providers.

Following are examples illustrating situations in which financial advice may include credit assistance:

• A financial planner suggests that a consumer consolidate their credit cards to a specific card with a low-interest rate, then this would be credit assistance.

• If a financial planner suggests that a consumer consolidate their credit cards to a specific card with a low interest rate, then this would be credit assistance.

• If a financial adviser prepares a financial plan in which the planner positively advises a client to continue in their current home loan then that is credit assistance.

• A consumer approaches their financial adviser for advice about salary packaging in circumstances where their employer has a default arrangement with a particular credit provider. The consumer wants to know if they should use the default credit provider or use another credit provider. If the adviser explains the different features or draws comparisons between them, then that is likely to be credit assistance.

If you are a financial planner and your advice amounts to credit assistance under the National Credit Act, you will need to hold a credit licence or to be covered by a principal’s credit licence, as an authorised representative or form a strategic alliance with your local Finance Broker.

Do not jeopardize your Professional Indemnity (PI) Insurance – get a credit licence, or one of the above options, to ensure you are covered to give full advice to your clients.

SOLUTION

Certificate IV in Financial Services (Finance/Mortgage Broking) FNS40804

(minimum education requirement for credit licence)

ONLINE ONLY $497

For more information on the credit regulations please refer to www.asic.gov.au