SC: Planners should give sound financial advice

“Portability between different PRS Providers is permitted once a year," SC chairman Awang Adek said.

KUALA LUMPUR: The Securities Commission (SC) is considering full tax exemptions on small amounts of withdrawal from private retirement schemes (PRS) for emergency purposes and improving the process for members to transfer across various funds and providers.

“If a member’s chosen fund or default fund does not provide a commensurate return over a certain period, they can switch to a different fund or provider.

“Portability between different PRS Providers is permitted once a year. This process should be as easy and seamless to increase PRS’s appeal and competitiveness of the industry,” said SC chairman Datuk Seri Awang Adek Hussin.

“The SC and the Private Pension Administrator Malaysia recognise this and will work with PRS Providers to develop a digital process for members to switch across funds more seamlessly,” he added.

Meanwhile, Awang Adek said the revised guidelines on conduct for capital market intermediaries aims to elevate standards of professionalism and integrity for financial planners.

“This will assist in attracting and retaining the next generation of long-term clients. The revised guidelines reinforce the role of an intermediary’s board and senior management in inculcating a corporate culture, where clients’ interests are prioritised,” Awang Adek said in his speech at the Financial Planning Association of Malaysia (FPAM) Signature Annual Financial Planning Symposium 2024 yesterday.

The revised guidelines will also clarify the SC’s expectations on an intermediary’s duty to act honestly and fairly – without misleading or deceiving clients, he said.

“In addition, the revisions reframe obligations to ensure that intermediaries exercise care, skill and diligence and consider the client’s interest when providing personal advice to clients,” he added.

These revisions are only effective from October 2024 to give intermediaries enough time to ensure compliance, the SC said.

“Financial planners should thoroughly review and take the necessary steps to ensure compliance, especially with regards to the personal advice obligations,” he added.