tmmonline.nz  |   landlords.co.nz        About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds

NZ's Financial Adviser News Centre

GR Logo
Last Article Uploaded: Friday, April 19th, 6:45PM

Mortgages

rss
Latest Headlines

Make commission details publicly available: MBIE

Government officials have proposed advisers make information about the fees they charge and the commissions they receive publicly available.

Tuesday, April 10th 2018, 3:18PM

by Susan Edmunds

The Ministry of Business, Innovation and Employment (MBIE) has released a discussion document as part of its work to develop the regulations that will fit alongside new financial advice laws.

MBIE said its review work had shown the existing financial advice disclosure rules had a lack of transparency on some factors that influenced financial advice, including commission. Officials said they had held workshops with consumers, mortgage advisers, financial advisers and investment advisers to gauge industry concerns. 

When choosing which provider of financial advice to work with, clients should be able to see details of the adviser's license, client care duties, complaints process, any limitations on the scope or nature of their advice, their fees and commissions.

"We think that consumers will benefit from being aware of these commissions and incentives," MBIE said.

"Having this information will help consumers decide whether to seek advice from a particular person and may lead to a conversation about how these conflicts are managed. Some consumers may wish to seek advice from someone who is not subject to these incentives. It will also help consumers when considering whether to follow the advice given to them."

MBIE also says consumers should receive information about an AFA or Nominated Representative's "relevant disciplinary history", as well as details such as the number of providers being considered, more detailed information on commissions that could be received, and the adviser's insolvency history.

Then, when the recommendation was made, further disclosure would apply, including a confirmation of the commissions paid. MBIE said mortgage advisers could also disclose information about which lenders they have contacted in order to give consumers a clearer view of the advice provided.

MBIE asked whether that information should be given in dollar terms.

However, MBIE is proposing more flexibility and a less prescriptive approach to disclosure. It said AFAs' secondary disclosure statements were currently often too long and complex for consumers to understand. MBIE said consumers ended up with so much paperwork that it reduced its effectiveness.

"A prescriptive approach can provide certainty to the industry and can create documents that make it easier for consumers to compare similar products or services," MBIE said.

"However, given the variety of ways that consumers can access advice in the new regime and the diverse range of activities captured by the definition of financial advice, we are concerned that a similar approach may cause undue compliance costs (e.g. in instances when relatively straight-forward financial advice is being provided), and may lead to a tick-box approach to disclosure."

It said regulations should set out what information needed to be disclosed when but provide flexibility in how that was offered.

Disclosure should provide consumers with the key information they needed, the right information at the right time, information in a way that was accessible, effective disclosure regardless of the channel and it should not impose unnecessary compliance costs, MBIE said.

Submissions on the discussion paper are due by May 25.

"I want consumers to make the best decisions they can during their financial planning so ensuring important information is available and easy to understand is crucial. For example, information hidden in fine print isn’t helpful to consumers – that might be information about commissions or incentives that the provider receives, and the fees that will be charged," said Commerce and Consumer Affairs Minister Kris Faafoi.

“Consumers should have that information to assist them to decide, for example, whether to obtain advice from a particular provider.  I want to make sure that important information is presented in simple terms that consumers understand."

Tags: FSLAB regulation

« Tech firm to visit NZ ahead of electronic lodgement launchANZ increases servicing rate for loans »

Special Offers

Comments from our readers

No comments yet

Sign In to add your comment

 

print

Printable version  

print

Email to a friend
News Bites
Latest Comments
Subscribe Now

Mortgage Rates Newsletter

Daily Weekly

Previous News
Most Commented On
Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA - Back My Build 6.19 - - -
AIA - Go Home Loans 8.74 7.24 6.75 6.65
ANZ 8.64 7.84 7.39 7.25
ANZ Blueprint to Build 7.39 - - -
ANZ Good Energy - - - 1.00
ANZ Special - 7.24 6.79 6.65
ASB Bank 8.64 7.24 6.75 6.65
ASB Better Homes Top Up - - - 1.00
Avanti Finance 9.15 - - -
Basecorp Finance 9.60 - - -
Bluestone 9.24 - - -
Lender Flt 1yr 2yr 3yr
BNZ - Classic - 7.24 6.79 6.65
BNZ - Green Home Loan top-ups - - - 1.00
BNZ - Mortgage One 8.69 - - -
BNZ - Rapid Repay 8.69 - - -
BNZ - Std, FlyBuys 8.69 7.84 7.39 7.25
BNZ - TotalMoney 8.69 - - -
CFML Loans 9.45 - - -
China Construction Bank - 7.09 6.75 6.49
China Construction Bank Special - - - -
Co-operative Bank - First Home Special - 7.04 - -
Co-operative Bank - Owner Occ 8.40 7.24 6.79 6.65
Lender Flt 1yr 2yr 3yr
Co-operative Bank - Standard 8.40 7.74 7.29 7.15
Credit Union Auckland 7.70 - - -
First Credit Union Special - 7.45 7.35 -
First Credit Union Standard 8.50 7.99 7.85 -
Heartland Bank - Online 7.99 6.69 6.45 6.19
Heartland Bank - Reverse Mortgage - - - -
Heretaunga Building Society 8.90 7.60 7.40 -
HSBC Premier 8.59 - - -
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 7.85 7.05 6.75 6.59
Lender Flt 1yr 2yr 3yr
Kainga Ora 8.64 7.79 7.39 7.25
Kainga Ora - First Home Buyer Special - - - -
Kiwibank 8.50 8.25 7.79 7.55
Kiwibank - Offset 8.50 - - -
Kiwibank Special - 7.25 6.79 6.65
Liberty 8.59 8.69 8.79 8.94
Nelson Building Society 9.00 7.75 7.35 -
Pepper Money Advantage 10.49 - - -
Pepper Money Easy 8.69 - - -
Pepper Money Essential 8.29 - - -
Resimac - LVR < 80% 8.84 8.09 7.59 7.29
Lender Flt 1yr 2yr 3yr
Resimac - LVR < 90% 9.84 9.09 8.59 8.29
Resimac - Specialist Clear (Alt Doc) - - 8.99 -
Resimac - Specialist Clear (Full Doc) - - 9.49 -
SBS Bank 8.74 7.84 7.45 7.25
SBS Bank Special - 7.24 6.85 6.65
SBS Construction lending for FHB - - - -
SBS FirstHome Combo 6.19 6.74 - -
SBS FirstHome Combo - - - -
SBS Unwind reverse equity 9.95 - - -
Select Home Loans 9.24 - - -
TSB Bank 9.44 8.04 7.55 7.45
Lender Flt 1yr 2yr 3yr
TSB Special 8.64 7.24 6.75 6.65
Unity 8.64 6.99 6.79 -
Unity First Home Buyer special - - 6.45 -
Wairarapa Building Society 8.60 6.95 6.85 -
Westpac 8.64 7.89 7.35 7.25
Westpac Choices Everyday 8.74 - - -
Westpac Offset 8.64 - - -
Westpac Special - 7.29 6.75 6.65
Median 8.64 7.29 7.32 6.65

Last updated: 8 April 2024 9:21am

About Us  |  Advertise  |  Contact Us  |  Terms & Conditions  |  Privacy Policy  |  RSS Feeds  |  Letters  |  Archive  |  Toolbox  |  Disclaimer
 
Site by Web Developer and eyelovedesign.com