Information for Prospective Credit Representatives

Credit Representative Resources

Please click through the following links for details of our Licensing model: Cost Considerations Fee Comparisons to other Australian Credit Licensees Obligations as a Licensee compared to being a Credit Representative  How is this different to being a Credit Representative under my Aggregator? Our Approach to Lender Panels and non-lending products and services How does this affect my current aggregation arrangement? Other Frequently Asked Questions

Australian Credit Licence No. 384635 APPLY NOW

Cost Considerations
Cost Type	Implications for a Licensee	Implications for a Credit Representative
ASIC Credit Licence Fee	$450 per annum for a sole trader or natural person (single Director companies are included under the definition of sole trader in this instance) $1,000 up to $21,000 p.a. for an entity with more than one representative. Based on loan volume in the previous year.	No cost
Credit Representative Fees	There are no Credit Representative fees payable to ASIC.  However, if Licensees intend to appoint Credit Representatives they must consider the costs associated with the initial assessment and appointment of Credit Representatives and the costs of ongoing supervision of those Credit Representatives.	Choice of: $90 per month (EX GST)  OR $900 per annum (EX GST)
EDR Scheme Membership	Brokers must belong to an ASIC approved EDR Scheme.  Membership and annual fees vary and you should refer to respective Scheme websites for up to date information.  As a guide: Credit Ombudsman Service Limited (COSL): Application Fee $165 Annual Fee $250 www.cosl.com.au Financial Ombudsman Service (FOS): Application Fee $220 Annual Fee $275 www.fos.org.au	In order to ensure the broadest possible choice to our Credit Representatives The I-Financial Group holds Membership with both COSL (Member # M0004723) and FOS (Member # 24810).  The result is that our Credit representatives will not be required to pay an Application Fee and the respective fees will be: $75 p.a. for COSL   $55 p.a. for FOS
PI Insurance	The NCCP Act requires that a Licensee have in place adequate compensation arrangements.  This is generally accepted as being facilitated via adequate PI Insurance. The cost of PI Insurance is affected by a range of factors so you will need to obtain your own quote.  Please note that you must have PI Insurance in place that meets ASIC's RG210 at the time of your Licence Application.	Credit Representatives must hold PI Insurance that is acceptable to the Licensee.  In practise this means that the Credit Representative needs to be covered by the Licensee's PI Insurance - as any other arrangement runs a very real risk of exposing both Parties. We have liaised with a number of PI Insurers to establish 'group' coverage that will provide our Representatives with appropriate cover at  pricing well under that which individual entities could achieve.  Costs each year are (EX GST): $800 up-front; or $80 per month over 12 months  N.B.  The above costs are per Credit Representative where that Representative writes standard home loan and consumer finance of up to $20M per year.  For higher loan volumes and/or where commercial or non standard finance is written by the Representative costs may be higher ~ but will definitely be competitive.  If you fall into this category, we will provide you with an individual quote once you complete the Credit Representative Application Form.
Licence Application Assistance	There are numerous organisations that will offer support in the preparation of your Licence Application and supporting "proofs".  The services and fees vary, however for a comprehensive package of application support plus the introduction of processes for ongoing maintenance of your Licence you can expect to pay in the vicinity of $5,000.	No cost Credit Representatives are not required to make an application with ASIC nor lodge anything with ASIC. Our Compliance Team will assist you to complete our Application to become a Credit Representative and will undertake the necessary appointment on the ASIC system on your behalf.
Ongoing Assistance	Again, numerous organisations are emerging to allow you to outsource some or all of your compliance work as a Licensee. However please note that, while you can choose to outsource the work involved in meeting your compliance and audit requirements, you cannot outsource the compliance liability - which always rests with the Licensee.	No cost. The majority of the compliance burden sits with us as the Licensee. You have unlimited access to our Compliance Team and associated resources as part of your Credit Representative fee.
Worked Example	Minimum ACL cost = $450 Minimum annual EDR = $250 PI Insurance (average for sole trader) = $1,800 Total p.a. = $2,500 Plus:    Initial licence assistance costs or opportunity costs             Annual compliance costs or opportunity costs	Credit Representative Fee (GST incl) = $990 Maximum EDR Fee = $75 PI Insurance (GST incl) = $880 Total p.a. = $1,945 Therefore, this option is more cost effective even before considering compliance costs, hassles and headaches.
Please note: all information and fees are provided in good faith and have been obtained from sources that the I-Financial group believes to be reliable.  Some fees will vary depending on individual circumstances and as such should be taken as a guide.  The I-Financial Group does not take any liability for inaccurate information.  Readers are encouraged to undertake their own research as appropriate.

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Fee Comparisons	Aggregator A	Aggregator B	I-Financial Group
Set-up Fee	$399 + GST	NIL	NIL
Ongoing Fee	$149 + GST per month = $1,788 + GST p.a. N.B.  PI Insurance is extra	$139 + GST per month = $1,668 + GST p.a. N.B.  PI Insurance is extra	Your choice: $90 + GST per month $900 + GST p.a.  (save $180)

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Obligations and Responsibilities		Licensee	Credit Rep
Licence Management	Lodge Application for Licence Lodge Annual Certificate of Compliance Ensure representatives only conduct business with appropriately licensed entities Ensure that responsible persons are, and remain, 'fit and proper' Notify ASIC if key persons change	YES	NO
Financial Management	Maintain budget and cash flow projections (review regularly to ensure solvency) Compile and regularly maintain an assets and liability statement Processes for recording and monitoring of financial records	YES	NO
Risk Management (including insurance)	Compliance Plan Risk Management Plan Ensure Credit Representatives have adequate PI Insurance	YES	NO
Processes and Procedures	Processes and Procedures to ensure: Customers receive a copy of Licence / Authority within prescribed period Notices to ASIC are remitted on time Credit Representatives adhere to laws and licence conditions	YES	NO
Human Resource Management (including training)	Documented role profiles and responsibilities Process to assess and appoint Credit Representatives Training of Credit Representatives and employees to ensure competency to engage in credit activities and adhere to licence conditions Continuing Professional Development (CPD) programme and registers to record completion of minimum 20 hours CPD for all Credit Representatives Notification to ASIC of appointment and termination of Credit Representatives	YES	NO
Compliance Monitoring and Supervision	Establish and manage processes to: Supervise and monitor staff and Credit Representatives Review the quality of work Identify and rectify breaches	YES	NO
Resource Management	Establish and manage processes to ensure: Selection and competence of outsourced arrangements Adequate IT and data security for file storage	YES	NO
Customer Complaints	Establish and manage internal disputes resolution process to ASIC's standards Ensure currency of EDR Scheme Membership for Licensee and all Credit Representatives Demonstrate adequacy of resourcing to manage customer complaint volumes	YES	NO
Customer Advice	Know your Client Know your Product Document your advice Ensure that the Product is not unsuitable	YES	YES
Customer Disclosure	Preliminary assessment Credit Guide Quote Credit Proposal Disclosure Document	YES	YES
Customer Advice Processes	Develop an advice process that meets your Licence conditions Develop policies and processes to cover the obligation to ensure consumers are not disadvantaged through conflicts of interest	YES	NO
Training, Supervision and Monitoring	Train your Credit Representatives and ensure their continual professional development Have a process to supervise and monitor compliance of the credit assistance provided to customers by your Credit Representatives	YES	NO
Internal Dispute Resolution	Review IDR processes annually	YES	NO
External Dispute Resolution	Review EDR Scheme Membership annually	YES	NO

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Frequently Asked Questions

How is this different to being a Credit Representative under my Aggregator?  Regardless of whether you are a Credit Representative under your Aggregator or under the I-Financial Group you will be required to adhere to the policies and procedures of the Licensee.  For many Brokers, however, being a Credit Representative under an Aggregator that is owned or heavily influenced by "product manufacturers" causes some concerns about the independent operation of their business and unfettered access to a broad range of products and services.  Certainly this has been the experience in Financial Planning since FSR.  This is the most comparable regime to what Brokers are now experiencing.

How does this affect my current Aggregation Arrangement?  You are free to continue to aggregate with your current Aggregator or change as you see fit - and because you maintain your Credit representative status with us you can easily change Aggregator in the future without the fear of being unlicensed during any transitional period. The I-Financial Group has established its licensing model to be "Aggregator Agnostic".  In other words we have separated your licensing decision from your choice of aggregation.  Our goal is to engage all Aggregators to form solid working relationships in order to assist to raise professionalism and compliance standards across the industry as a whole.

What will my panel of products and services look like? Subject only to our requirement to verify that they are Licenced entities ~ you will continue to have access to all lenders and additional products and services on your Aggregator's panel plus a range of cutting edge products and services on the I-Financial Group approved product list.  For more information refer to our Practice Management page. Additionally we will review requests from any of our Credit Representatives to assess the suitability of other lenders and service providers.  If approved they will be made available to all Credit Representatives.  In most cases you will be free to establish direct agreements with those lenders and service providers that do not have a Head Agreement with your Aggregator. Given the above ~ it is reasonable to assume that we will have the broadest panel offering in the marketplace and our Credit Representatives can anticipate being able to develop significantly enhanced revenue streams.

Can I have my company appointed as a Corporate Credit Representative? Yes - we will appoint your company as a Corporate Representative subject to normal compliance checks.  This allows you to include the CRN on marketing and other material at your company level. We will provide one individual Credit Representative free of charge under each Corporate Representative.

How do I appoint Credit Representatives under my corporate structure? We will not authorise your Company to independently sub-authorise Credit Representatives. We will provide you with the appropriate Application Forms and assistance to request us to appoint a Credit Representative under your entity and we will never unreasonably refuse your request.

What are the minimum educational standards to be a Credit Representative? ASIC has determined that the minimum education required is Certificate IV ~ which must be completed by 30 June 2014. We would prefer to see Credit Representatives commit to this generally accepted industry minimum qualification well ahead of ASIC's time line.  However, we will not refuse an Application on this basis provided you can demonstrate sufficient knowledge and experience to ensure your ability to comply with our requirements as Licensee.

Do I have to be a Member of an Industry Body? There is no legal requirement to be a member of an industry body or group.  We will not be imposing any artificial constraints in this regard. We believe industry body membership is an individual business decision ~ but we note that the vast majority of professionals across the financial services spectrum are members of one or more industry organisations. Note that you must be a Member of an ASIC approved EDR Scheme.

What are the CPD requirements? CPD requirements under the NCCP Act are a minimum of 20 hours per annum. We will provide a system to allow you to report CPD activities to our Compliance Team to assist you to meet your annual reporting requirements.

What training and support can I expect? All of the activities that you are used to undertaking ~ such as lender sessions and Aggregator training sessions, PD days, and conferences will continue to attract CPD. Additionally we will provide support and training via a variety of media to assist you with your education and understanding of the NCCP Act and requirements as a Credit Representative.

How will my compliance as a Credit Representative be reviewed? We will assist you to maintain compliance in a  number of ways.  Our philosophy is to educate and assist you to embrace the new licensing regime as a way to differentiate yourself in the market and build a more professional and substantial financial services Practice. Compliance reviews will include: A comprehensive review of your first 5 Credit Advice document suites following appointment (after 1 Jan 2011) Random review of Client files Pre-audit self assessment guide to be completed and returned 4 weeks ahead of any scheduled audit On-site compliance audits and Practice management reviews Written feedback on areas of opportunity for improvement (or immediate rectification in extreme cases)

What about software and technology support to assist me to be compliant? The vast majority of Brokers are currently utilising Aggregator-provided software or have accessed software support of their own choosing.  We do not want to re-invent the wheel or layer additional costs onto Credit Representative businesses. Our compliance Team will be liaising with the Compliance Officers and IT departments of Aggregators with proprietary software - as well as other industry software providers - to ensure we have a thorough knowledge of the various approaches to delivering compliant systems and processes to Brokers within extant IT systems. Where you, or your Aggregator, do not have systems and processes that meet our requirements we can arrange either: An introduction to 'off the shelf' software providers with compliant processes, or An introduction to Aggregators with compliant IT programmes

What are my licensing disclosure requirements to consumers? You must disclose the fact that you are a Credit Representative of a Licensee along with that Licensee's Australian Credit Licence number on all 'client-facing' documentation including marketing and websites.  Back to top                                                                                                                                                            APPLY NOW