The Financial Conduct Authority has shelved plans for a standalone equity release qualification.
After a consultation it concluded there was not a “market need” for such a qualification and shelved the plans.
But several respondents in the industry told the FCA there were already far more advisers qualified in equity release than were selling the product.
The regulator's consultation also found that generalist advice firms were unlikely to have a significant number of clients where equity release was a suitable option, meaning acquiring leads would be costly for these firms.
In a policy paper published this morning (9 May), the FCA said: “We note that respondents had a range of views on the relative merits of a standalone versus top-up approach.
“These centred on two themes: the desirability of holistic retirement advice and the ongoing need for mortgage content in an equity release qualification.
“We also note that some firms would like to deliver holistic retirement advice but were mixed in their views on how to achieve this.
“We recognise that a solid understanding of mortgages is, and is likely to remain, an important competency in giving equity release advice.
“If we consider this matter again in the future we will take the views received in this consultation into account.”
Research carried out by the Society of Mortgage Professionals and the Personal Finance Society found broad support for a standalone equity release qualification.
But information released under Freedom of Information rules revealed only two companies – both equity release providers – had called for the FCA to introduce such a qualification.
Mike Richards, director of London-based Mortgage Concepts Associates, said: "If you set your stall out to be an IFA, you are not going to want to start doing mortgages. You will need a lot more back office staff who know what they are doing so I think it is the right decision."
This morning’s policy paper also covered other aspects of qualifications, including continuous professional development.
It set out the final, updated appropriate exam standards for the appropriate qualifications listed in the FCA’s training and competence sourcebook.
During the consultation period, concerns were expressed that the appropriate exam standards would limit advisers from carrying out the widest range of CPD relevant to their role.
In response, the FCA said: “The appropriate exam standards are not qualifications themselves, but they set out the learning outcomes, the levels of attainment that a candidate must achieve and the indicative content relevant to each learning outcome to inform qualifications that providers make available.
“Appropriate qualifications remain valid, no matter how long ago they were awarded, but must remain relevant to the activities in question (for example, the regulated activities of retail investment advice and mortgage advice).
“Firms must ensure that their employees are and remain competent – this may include asking staff to re-take qualifications, where appropriate.”
damian.fantato@ft.com
