You may have noticed that financial institutions state that they’re registered Financial Services Providers (FSP). But what does this actually mean, and how does this benefit you as a consumer?
We got in touch with a certified financial planner to find out how the financial industry is regulated and what you can do to keep them in check.
Tip: You can take out a personal loan from a registered FSP by clicking here.
What is an FSP and what does an FSP number mean?
A Financial Services Provider includes any institution that offers financial advice or offers personal finance products, such as insurance, investments, or loans.
According to Reagan Mitchell, certified financial planner and managing director of WealthyMe, each FSP is allocated a unique number by the FSCA (Financial Services Conduct Authority).
“Financial Services Providers need to disclose their FSP number in all marketing and other official documentation when dealing with the public,” says Mitchell.
“An FSP number is an indication that the holder of the FSP number meets the stringent requirements as set out by the FSCA to be licensed in order to provide financial services and advice,” says Mitchell.
He explains that obtaining an FSP license is a difficult process, and that the requirements include things like experience, qualifications, ethics, operational ability, financial soundness, and competence.
“It’s important for members of the public to always deal with a registered FSP when seeking financial advice,” he adds.
How to check an FSP number
Mitchell says that an FSP license number is something that should be maintained on an annual basis by the holder of the license number.
“The FSCA can at their discretion withdraw or suspend a license if the FSP doesn’t meet the ongoing requirements of being an FSP,” says Mitchell.
Therefore, if you suspect a Financial Services Provider is not meeting the FSCA’s standards, you can report them to the regulatory body, who will then investigate their practices.
Mitchell highlights that members of the public can go onto the FSCA’s website to verify whether the FSP number used by a company is indeed a registered FSP. The website can be accessed here.
You can also lay a complaint against a registered Financial Services Provider by going to this site and filling out the form.
If you need a personal loan from a registered Financial Services Provider, click here.