Partners Life head of industry engagement Mark Banicevich believes the new financial advice regime in New Zealand is going to be “the catalyst for so much opportunity” in the market.
Speaking at the Wellington leg of the Financial Services Council of New Zealand’s (FSC) Future Ready Advice Summits, Banicevich said: “I find that the major change from the old regime to the new [one] is that the financial advisers were really individualised advisers. It was all about giving financial advice; there was really nothing more around it. Now we’ve moved to a paradigm where it’s about financial advice under the guidance and oversight of a strong and robust business.
“There’s been a requirement for advisers – who, in many cases, haven’t got that background – to upskill very quickly and learn about what the requirements are to run a robust business. I think at the moment we’ve got a real dichotomy of people who are starting to get their head around that and still a large number of licence holders who don’t really understand what it means to do that because it’s just not their background.
“I think we’ve got a real journey to continue to go on for those businesses, and I think you’ll find that as a result of going on that journey you’ll end up with a much stronger business. What really excites me about where we are right now is the opportunities in front of financial advice providers – they are just huge. This change is going to become the catalyst for so much opportunity, and I’m really excited about helping financial advice providers look into those opportunities and decide where they want to go.”
A former principal intelligence analyst at the Financial Markets Authority (FMA) – Te Mana Tātai Hokohoko, Banicevich believes part of the opportunity lies in the market’s latency.
“We are still, as a general population, pretty uneducated when it comes to our financial capability and so forth,” he told attendees of the FSC event. “We’re not out there buying these products, yet [people] in the industry know that they’re really valuable for Kiwis. So, we have got this huge market opportunity. There’s also opportunity in this movement from individualisation to businesses, and the economies of scale that that offers.
“I think we have the opportunity to move away from, ‘I’m a financial adviser and here’s my business card, and I created this logo on the back of a napkin in a coffee shop one day or over a couple of beers’ – to thinking more about what the brand represents for my business and maybe thinking, ‘Do I want to continue to be one person in my business, or maybe I want to move to expand? I don’t have to, but I might want to expand to be four or five advisers. Do I want to stay just offering one product type, or can I expand into other product types?’
“So, there’s a huge market opportunity, which is great and gives us a good foundation, but there’s also massive opportunities in the way that we offer financial advice, with whom we offer financial advice, the technology we adopt to do so, and the efficiencies to make that happen. So, there’s a mountain of opportunities – not just one – which is why it’s exciting.”
Aside from Wellington, other legs of the FSC’s Future Ready Advice Summits were in Christchurch and Auckland. In August, the FSC is holding its annual conference, with this year’s theme centred on building consumer confidence.
