{"id":65841,"date":"2023-05-23T11:03:19","date_gmt":"2023-05-23T00:03:19","guid":{"rendered":"https:\/\/riskinfo.com.au\/news\/?p=65841"},"modified":"2025-03-14T12:02:23","modified_gmt":"2025-03-14T01:02:23","slug":"warning-on-consumer-confusion","status":"publish","type":"post","link":"https:\/\/riskinfo.com.au\/news\/2023\/05\/23\/warning-on-consumer-confusion\/","title":{"rendered":"Warning on Consumer Confusion"},"content":{"rendered":"
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The top story this week was our report on the potential confusion that might emerge in the mind of the consumer if they’re asked to differentiate between the terms ‘experienced provider’ and ‘relevant provider’…<\/h3>\n<\/div>\n<\/div>\n

If we aren’t careful, consumers are set to become even more confused about who to turn to for financial advice, according to The Advisers Association.<\/p>\n

TAA CEO Neil Macdonald<\/strong> says the association thinks using terms like \u2018experienced provider\u2019 and \u2018relevant provider\u2019 just creates deeper consumer confusion.<\/p>\n

Referencing the association\u2019s submission to Treasury\u2019s consultation on Education Standards for Experienced Financial Advisers and Technical Fixes for New Entrants<\/em>, Macdonald says all consumers really want to know is that the financial adviser they are dealing with is suitably qualified, knows what they\u2019re doing, and can be trusted.<\/p>\n

He says the industry must have an experienced pathway \u201c\u2026because in order to fulfil consumer demand for advice, we have to do something to stem the exit of highly experienced advisers from the profession.\u201d (Also see: Support for a Better-targeted Pathway<\/a>).<\/p>\n

\"\"<\/a>
Neil Macdonald …consumers must be wondering what is so difficult<\/figcaption><\/figure>\n

But, he asks “…are we over-complicating it? If we stand on the outside for a moment and look in, consumers must be wondering what is so difficult.\u201d<\/p>\n

Some of TAA\u2019s concerns centre around the way the experienced pathway is being framed.<\/p>\n

The association thinks using terms like \u2018experienced provider\u2019 and \u2018relevant provider\u2019 just creates deeper consumer confusion.<\/p>\n

\u201cThe differences between these two providers are not immediately clear and will have to be explained. There\u2019s also the risk that people will think \u2018experienced\u2019 is somehow better than \u2018relevant\u2019. It certainly looks like that at first glance,\u201d Macdonald says.<\/p>\n

TAA\u2019s preference is the same naming convention for all financial advisers in law.<\/p>\n

…the difference between an experienced adviser and a relevant adviser could then be simply addressed at the consumer level…<\/p><\/blockquote>\n

He adds that the difference between an experienced adviser and a relevant adviser \u201c\u2026could then be simply addressed at the consumer level, for example, adviser qualifications or lack thereof, and experience, could be contained in the Financial Services Guide and marketing materials.\u201d<\/p>\n

Consumers are also likely confused about the level of education and training required of advisers.<\/p>\n

MacDonald says TAA is sure many consumers still don\u2019t know what qualifications financial advisers must hold and, if they do \u201c\u2026they are likely scratching their heads as to why there has so far been such a one-size-fits-all approach to adviser education.\u201d<\/p>\n

He adds consumers are also likely to be wondering why prior learning and a broader range of relevant qualifications are not better recognised, particularly for those wanting to enter the profession from closely-related fields, saying it doesn’t make sense that new entrants are being given flexibility around process changes to education and training standards, when experienced advisers are not.<\/p>\n

…these anomalies are counter-intuitive…<\/p><\/blockquote>\n

\u201cWe\u2019re trying to grow a profession here, so these anomalies are counter-intuitive,\u201d\u00a0 he notes.<\/p>\n

TAA is also concerned about the many different months and years being applied to the 10-year experienced pathway.<\/p>\n

MacDonald says this creates \u201c\u2026unnecessary risks, unintended gaps and unnecessary complexity for Treasury, regulators, licensees and advisers. This level of complexity might be all well and good if it provided substantial additional consumer protection, but in our opinion, it does not \u2013 and once again, it will need to be explained to consumers, creating yet another education exercise.\u201d<\/p>\n

To retain experienced advisers and for consistency, TAA thinks the period for the 10-year experience should be aligned with the current education standards deadline, i.e. 31 December 2025 or \u2018before 1 January 2026\u2019.<\/p>\n

He notes that Wealth Data identified that this change alone would enable an additional 555 advisers to meet the experienced pathway.<\/p>\n","protected":false},"excerpt":{"rendered":"

The top story this week was our report on the potential confusion that might emerge in the mind of the consumer if they’re asked to differentiate between the terms ‘experienced provider’ and ‘relevant provider’… If we aren’t careful, consumers are set to become even more confused about who to turn to for financial advice, according […]<\/p>\n","protected":false},"author":24,"featured_media":65844,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[282,8,8291],"tags":[],"class_list":{"0":"post-65841","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-associations","8":"category-compliance-regulation","9":"category-story-of-the-week"},"_links":{"self":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/65841","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/users\/24"}],"replies":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/comments?post=65841"}],"version-history":[{"count":0,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/65841\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media\/65844"}],"wp:attachment":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media?parent=65841"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/categories?post=65841"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/tags?post=65841"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}