The Australian Securities and Investments Commission is proposing changes to the way financial services disclosure documents are delivered, in a bid to make them more engaging for consumers.
The regulator has issued a consultation paper (CP 224) which seeks feedback on the electronic delivery of financial services disclosures. ASIC said it hoped to make electronic disclosure the first choice (or default) method for financial services providers, while preserving choice for both consumers and providers.
Among the benefits of electronic disclosures, ASIC lists the fact that online documents can be more engaging and informative than those delivered via print.
Electronic disclosures are also viewed by the regulator as being a faster and more convenient alternative than traditional print documents, and therefore provide cost savings to providers.
ASIC said that while most financial services disclosures can already be delivered electronically, the current guidance and existing legal requirements generally mean that the default method of delivery is print.
Some of the barriers or issues to producing more innovative forms of disclosure identified by the regulator include:
- Current ASIC guidance which suggests that express agreement must be obtained from the client before a provider can deliver a disclosure to an email address
- A perception among providers that they cannot produce two different versions of a Product Disclosure Statement (PDS) for the same product
- Continued consumer demand for printed disclosure
- Record-keeping obligations that require a PDS to be presented in a way that allows the client to retain it in a readily accessible format for future reference
“ASIC is focused on making disclosure more effective and meaningful for consumers of financial services. We want to encourage more innovative ways of delivering important information presented in a way that consumers can understand and act on,” said ASIC Commissioner, John Price.
“At the same time, we believe electronic disclosure could reduce costs for providers and enable them to better align their disclosure with consumer preferences,” he said.
Comments on the consultation paper are due by 16 January 2015.
