The Financial Planning Association (FPA) has sought to ramp up pressure on the Federal Government for the formal removal of the term “general advice”, this time in the context of enhancing digital advice delivery.
While making clear that face to face client relationships would remain pivotal for financial advisers, the FPA has claimed that renaming “general advice” will enhance digital advice delivery.
It said that guidance for consumers would be importance to help them distinguish between “tailored advice”, “guidance” and “general advice”.
The FPA’s messaging is contained in a submission to the Senate Selection Committee on Financial Technology and Regulatory Technology, in which it said that digital advice delivery was usually considered as “general advice” and “any future concern of removing general advice will ultimately inhibit what digital advice can be provided”.
“The government can ensure that the future delivery of digital advice remains available for the FinTech community to develop by supporting [the Australian Securities and Investments Commission] ASIC to rename general advice,” it said.
The FPA submission said ASIC had consumer tested and consulted stakeholders on potential new terms to rename general advice and the FPA would continue providing support in renaming the term.
“A change in terms would also enhance a consumer’s understanding of what information is presented to them from digital services and may prompt consumers to seek more personalised advice after receiving personal advice,” it said.
Elsewhere in its submission, the FPA said there was a strong perception that robo-advice would replace human financial planners but it disagreed with this scenario.
“The FPA believes that financial planners will work hand-in-hand with robo-advice, and the benefits of fintech will ultimately be passed down to consumers,” it said.