The Australian Securities and Investments Commission (ASIC) has delivered its “final warning” for financial advisers that are yet to meet the education requirements on the Financial Adviser Register, making an urgent call for details to be updated.
Under the education requirements, relevant providers who are also existing providers and who do not meet the qualifications standard by 1 January 2026 will not be able to provide financial advice.
AFSLs are responsible to ensuring the records are both accurate and up to date on the FAR, and ASIC said their AFSL “should consider ceasing their authorisation on or before 31 December 2025 to avoid consequences to the existing provider status”.
“In accordance with the legislation, if the relevant providers remain authorised and their authorisation ceases by operation of law on 1 January 2026, they will be required to compete a professional year and obtain an approved degree or equivalent qualification set out in Schedule 1 of the Corporations (Relevant Providers Degrees, Qualifications and Courses Standard) Determination 2021 before they can provide personal advice to retail clients again,” the regulator said.
“They will be unable to meet the qualifications standard by accessing the existing provider pathways as set out in Part 3 of the determination.”
In the update, the regulator said that, as of 20 November, there were 15,469 relevant providers on the FAR. Of these, AFS licensees have notified ASIC that 7,959 hold an approved degree or qualification, 4,212 are relying on the experienced provider pathway, and 972 are recorded as holding both an approved degree or qualification and relying on the experienced provider pathway
“The remaining 2,326 relevant providers have yet to meet the qualifications standard according to the information currently recorded on the Financial Advisers Register,” ASIC said.
“Of this cohort, 836 may be eligible for the experienced provider pathway, but their AFS licensees are yet to notify ASIC of this.”
It added that 827 relevant providers who are also existing providers, unless exempt, will need to complete the specified courses in commercial law and taxation law to continue to provide tax (financial) advice services from 1 January 2026.
ASIC said advisers need to ensure they meet the education and training requirements, review the accuracy of their information recorded on the FAR, and ask their AFSL to notify ASIC of their qualifications, or if eligible, that they are relying on the experienced provider pathway.
The regulator has also ASIC’s new webpage, Updating the Financial Advisers Register – Qualifications and training details, which includes step-by-step instructions on how to review the one-off data set and provides information on how to update any incomplete or inaccurate information.
“ASIC encourages AFS licensees and relevant providers to double check the data using these new instructions,” it said.
Last week, Padua Wealth Data founder Colin Williams said incomplete records make it challenging to determine how many advisers may exit as a result of the new requirements; however the “best case” would see 892 advisers leave the profession, bringing the total down to 14,567.
“When a series of ‘what if’ scenarios are performed, the net loss can easily jump in excess of 1,600. Adding together the most realistic outcomes across all categories the net loss range will be between 1,100 and 1,500,” Williams said.
If 1,600 advisers were to leave, this would bring the profession down to just 13,859.
Some of the losses may also be temporary as advisers have the option of dropping off the FAR ahead of the deadline in order to complete their education requirements and later rejoin the profession.
The FAAA revealed in August that this loophole allows advisers to avoid the need to redo their professional year (PY) as those who remain on the register but don’t meet either requirement will be required to do so in order to continue practicing once they complete their education.
Although there is still some hope, Williams said a significant drop in advisers would create a number of challenges such as increasing the client load of the remaining advisers, creating longer turnaround times for clients, further exacerbate the advice accessibility issue and put increased pressure on the cost to serve.
