There are two Margin Lending Accreditations:
- Margin Lending Accreditation – this is a 1.5 hour online exam (+ 15 minutes reading time. 40 multiple choice questions, 80% passmark). This accreditation meets the training requirements under ASIC Regulatory Guide RG146 to provide retail advice in specialist knowledge for Margin Lending at a Tier 1 level; and
- Margin Lending Skills Accreditation – this is a Case Study Assignment that meets the “Skills” component for ASIC Regulatory Guide RG146 (in Margin Lending) at Tier 1 level.
In 2008, the Council of Australian Governments (COAG) agreed that the Australian Government should adopt responsibility for the national regulation of consumer credit, including margin lending facilities. The Corporations Legislation Amendment (Financial Services Modernisation) Bill 2009, setting
out amendments to the Corporations Act 2001 (Cwlth) and the Corporations Regulations, was subsequently passed by Federal Parliament in late 2009.
Before the legislative changes, margin loans were not directly regulated. The Corporations Act did not cover credit products such as margin loans, and State and Territory legislation governing consumer credit excluded investment loans such as margin lending.
A concern was that the lack of regulation meant investors were not fully aware of the risks associated with margin lending products. These risks were brought home to many investors during the market volatility experienced in the global financial crisis.
Margin Lending is now explicitly included as a financial product for the purposes of Chapter 7 of the Act.
Defining margin lending as a financial product has a range of consequences, including that providers of financial services in relation to margin loans are now subject to the licensing, conduct and disclosure requirements in Chapter 7. Margin lending providers must ensure that their representatives are adequately trained and competent.
Advisers on margin lending must fulfil the training requirements under Regulatory Guide 146 ‘Licensing: Training of financial product advisers’ (RG 146). RG 146 sets out minimum standards for the training of all advisers, and has been updated to include margin lending as a Tier 1 product.
An adviser who provides advice on Tier 1 products must undertake:
- training in generic knowledge of the environment in which the products operate, and
- specialist knowledge training on the financial products on which advice is provided.
The Margin Lending Accreditation is intended to provide specialist knowledge training for advisers providing advice on margin lending facilities, as set out in Appendix A2 of RG 146.
If an adviser provides personal advice, they are also required to complete approved training courses covering relevant skills.
The Margin Lending Skills Accreditation is intended for those candidates who have already completed courses on ‘providing advice in …’ other financial products such as securities, managed investments, derivatives and/or superannuation. Candidates should be familiar with the advice giving process already. The focus of the Margin Lending Skills Accreditation is the advice giving process – not the bigger picture of being a licensee and complying with legislative requirements. Most of the detail is about the skills of giving advice – fact finding, setting objectives, evaluating products, justifying solutions, presenting solutions and negotiating outcomes.
The Margin Lending Accreditation covers the areas of:
- Margin Lending
- Alternative means of achieving geared exposure
- Tax deductibility of the interest
- Franked dividends
- Capital Gains Tax
- Compliance topics
Is there any assumed pre-requisite knowledge?
There is no assumed knowledge for this accreditation.
Margin Lending Accreditation:
1 x Online Exam (Open or Closed Book, 40 questions, 1.5hrs + 15min reading time, 80% pass mark)
Margin Lending Skills Accreditation:
1 x Assignment (Case Study, 80% pass mark)
Suggested study hours
Margin Lending Accreditation: Allow up to 120 hours
Margin Lending Skills Accreditation: Allow up to 120 hours
Will participants receive any CPD points for completing the accreditation?
Yes. Candidates who successfully complete the Margin Lending Accreditation or the Margin Lending Skills Accreditation may claim up to 10 hours of CPD (20 hours if doing both). these hours may be claimed as Compliance, Generic, Securities and/or Margin Lending CPD).