A move to raise the professionalism of financial advisers and improve their perceived trustworthiness by laying out common standards was launched by the Institute of Banking and Finance (IBF) yesterday.
It marks the first time the financial advisory industry has agreed on a common set of competency standards.
Financial advisers here are trained by their companies. They can apply for professional certifications such as the Chartered Financial Consultant Singapore offered by the Insurance and Financial Practitioners Association of Singapore, or Certified Financial Planner from the Financial Planning Association of Singapore (FPAS).
The standards drawn up by the IBF are mapped against these existing certifications, which take between 130 and 180 hours of training to obtain. The IBF, which is the national accreditation body for financial sector competencies, added that it is in talks with firms about the accreditation of in-house training programmes.
Dr Khoo Kah Siang, president of the Life Insurance Association, led the IBF working group on developing the standards. "Currently we have lots of different standards, which unfortunately do not gel to a standard which the consumer feels confident to recognise," he said.
The new unified standards would help consumers gain more confidence in the qualification of their advisers, Dr Khoo added.
IBF chief executive Ong Puay See emphasised that the standards would professionalise the industry by giving financial advisers more structured career paths.
"Certification with structured pathways allow financial advisers to make easier choices.
"Instead of a mixed bag of 30-hour programmes, one could do an IBF-certified programme... allowing one to move up the ranks in a progressive way," she added.
There are about 18,000 financial planners in Singapore, according to industry sources. The FPAS said about 3,000 financial advisers have obtained certification.
Ms Ong said she was confident about the uptake of the IBF standards even though they are not mandatory, as "the content and the professional pathways" mapped out are "meaningful".
She added that greater professionalism would address the issue of the perceived lack of trust in financial advisers.
"We felt that we could contribute if the industry is being seen as self-serving... which is a disservice to these good quality training programmes," she said.
"Independent accreditation will bring back the concept of the professional trusted adviser."
FPAS president Joseph Kwok likened financial advisers to restaurant owners, saying that the new standards would enhance their professionalism.
"If you are a restaurant owner, you can just obtain a licence from the authorities, but if you want to be a master chef, you have to go through training school. These standards, to me, are about creating master chefs," he said.