7 Steps to Buy A Better Car Insurance

Buying a car insurance? It’s a bit different from buying life or health insurance.

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Know your customers - if they are yours!

The regulator and the fund companies are not in touch with their core constituency – the saver – and so simply don’t know how...

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It's time for 'seller beware'

A few days ago, marketing expert Seth Godin made a point in his blog about something we have been pointing out for quite some time: the flaw in the...

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Isn’t consumer protection the primary role of regulators’?

The ex-chairman of Insurance Regulatory and Development Authority (Irda) J Hari Narayn wanted Irda to have a new whole-time member representing...

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Consumer financial protection should stand on five pillars

Though the regulators have not thought of it, consumer financial protection should stand on five pillars: financial education/literacy; competent and...

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Consumer Products vs Mutual Funds: Half Truths and Lies

I would urge people to get hold of a copy of a book called Brandwashed. It is written by Martin Lindstrom, a marketing consultant of international...

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Mutual funds: Fund & games

In the old days, when one invested in chit funds or fixed deposits, the distributor would give you a gift of some kitchen items like plates or...

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Investors Protection: Legally dishonest

The government wants to restore investors’ confidence in the stock markets. How can I have confidence when the government breaks the rules to...

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Needed Jan Sunwai sessions for savers and investors

Over the past several months, I have described the situation of savers from all possible angles — the hollowness of “know your...

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Apple or Toyota of retail finance? Impossible!

The other day I got an email from one of our readers saying: “I want to bring to your attention how bogus these online term insurance plans...

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Changes in Our Business Model
 
 
Greetings from Moneylife Advisory Services
 
Between financial years 2019-21, SEBI has come up with extensive changes to investor advisor regulations. On Sep 23, 2020, SEBI had issued new additional guidelines. This comes just two months after extensive changes announced in July 2020. Earlier, in December 2019 there was an ad hoc circular
 
As a result of these changes, IAs, cannot accept fees through credit cards, will have to sign a 26-clause investor agreement, have to maintain physical record written & signed by client, telephone recording, emails, SMS messages and any other legally verifiable record for five years. IAs were already asked to record the suitability and rationale for every piece of advice given, sign them and store them for five years.
 
While these extensive and frequent changes, designed to strengthen the conduct of IAs are well-meaning, these have sharply increased compliance efforts and cost. We, being online advisors, find many of changes harder to implement, compared to advisors working in the physical space. We will have to have an army of advisors, administrative and tech staff to be compliant. If we do this, we will have to divert money to these areas and the cost of our service will double. We want to remain the least-cost service in the market to benefit more and more people. In the circumstances, we are forced to change our business model from “advisory” to “research”. This will mean the following:
 
What remains the same:
  • Recommendations on insurance, investment and Lion stocks, will continue as a part of the MAS premium subscription. Our strength has always been research and this will remain available to you through our recommendations.
  • The magazine and all textual content will remain as part of the service
  • The investools will have to be reworked and will offer model portfolios. We will have to suspend the restructuring tool.
 
What changes:
  • The interactions in Ask / Handholding will offer investment advice but not specific to your situation. It will offer information on investment products and also clarify your doubts about various financial products. It will be a forum for information, not for advice. This will be implemented with immediate effect and our guidelines in Ask, reflect this now.
 
Over the next few weeks our site and our communication to you will reflect these and other additional changes.
 
We feel this will not affect you much in terms of what really matters in investing: knowing what to buy and when to buy. This is our edge and it will still be available to you.
 
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Debashis Basu
Founder