THE financial advisory industry expects consolidation in its ranks, with the industry set to undergo the most wide-ranging shake-up in more than a decade.
Among the areas highlighted by the Monetary Authority of Singapore’s (MAS) managing director Ravi Menon yesterday evening in his speech to the Life Insurance Association was the proposal to move from a commission-based model to a fee-based one to avoid conflicts of interest between adviser and client.
If Singapore were to move towards a fee-based model, the Government would have to start educating customers now and ensure the market is ready to accept the changes before they are made, IPP Financial Advisers’ managing director Albert Lam said.
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Another consequence of this industry review is likely to be consolidation among industry players, heads of these financial advisory firms said.
The financial advisory industry in Singapore has grown in the past decade to around 60 firms, players estimate.
India as an example that had rolled out similar proposals in 2009. “There was a massive consolidation in India, and a lot of companies found that they could not survive.”
Read more: BT Invest
