New Group to Add Spice to Sluggish Financial Services

New Group to Add Spice to Sluggish and Under-Siege Financial Services Industry

Amid the controversial introduction of new regulations for the financial services industry and high levels of consumer distrust of advisers, a new support services group for organizations and advisers in the financial services sector is pledging to bring a new level of performance and education to the industry.

Ginger Group is the result of the combination of three established distribution organizations: financial services, investment and accountancy firm PIS (NZ) Ltd, the Minerva Group (which undertook a joint venture with PIS in mid-2009 to form Minerva PIS (NZ)), and Brokers Independent Group (BIG), an advisory group with a substantial training and business support arm for financial advisers. Ginger Group consists of more than 400 financial services practitioners in all branches of the industry.

The creation of Ginger Group brings significant scale to the services offered to members, including assistance with personnel, IT systems and processes, business development, training and succession planning. The group’s products and services are focused on financial planning, risk insurance, mortgage broking, accounting, retirement planning and tax advice.

Ginger Group CEO and executive director David Whyte says the group will help bring stability to a badly shaken industry, as advisers come to grips with regulatory changes. “New Zealand is a notoriously underinsured market when it comes to risk, and there is a clear need to rebuild trust in the wake of finance company collapses, widespread investor losses and highly publicized incidences of poor financial advice.

“Among what we’re offering to members which is unique in the industry is a full-time compliance officer, so all advisers affiliated with Ginger Group can be sure they are meeting all their legal obligations – whether they are authorized or registered financial advisers – and their clients can be confident they’re getting customized solutions that will work for them at the time needed.”

My Whyte says Ginger Group’s provision of a permanent compliance service would also ensure all members have regulatory expertise appropriate for the service they provide.

“The label of financial services has become something of a catch-all, and in our view it’s important to help consumers find the right adviser for their specific needs. It is crucial that industry groups, such as our own, show leadership as regulatory changes take effect, in order to protect and assist both consumers and advisers.

“In our view it is not the complexity of the product which should drive regulation but the complexity of the application of the product. For instance, a shop assistant recommending credit protection insurance for someone buying a washing machine need not be authorized, but should be obliged to disclose how much is being earned by the store for recommending the product. For disclosure to be effective, there must be consistency across the board in providing factual data to assist the consumer make an informed decision.

“Conversely, a financial adviser recommending shareholder protection, partnership insurance or other complex financial arrangements should be authorized, competent, and qualified to do so. Ginger Group will, among other services, actively support industry standards and the educational requirements for compliance, sales, and practice management development.

In addition to the in-house Compliance Service, Ginger Group is negotiating access to a specialist underwriting and claims service to assist with complex cases.

Also on board with Ginger Group is the major Australasian mortgage broking company Loan Market, which secures more than $100 million in home finance each month in New Zealand, and is in turn linked to Ray White, one of the largest real estate companies in New Zealand and Australia.

“Our relationships across the financial services industry are at the core of what we offer our members,” Mr Whyte says. “As a service support company we can give advisers the service that they would either have to pay exorbitant amounts for or not be able to access at all. And Ginger Group’s connections with practitioners as diverse as chartered accountants, mortgage brokers, and life insurance advisers mean we can foment valuable business relationships among members, for lead generation and business development and growth via other qualified professionals.”

ENDS

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