NZ is likely to get rid of commissions for financial advice on investment products in line with Australia, according to the country’s Investment Savings and Insurance Association.

CEO Vance Arkinstall says the “growing movement” within the Australian financial services industry to phase out commission on investment products “is a step to improved quality of advice to investors, and it is inevitable NZ will follow this change”.

“Phasing out commission will remove the suggestion that investment advice is related to the level of commission available to the adviser rather than the best interests of the consumer,” he said.

“The downside is that if commission is phased out, advisers will charge a fee for investment advice. For some small investors, being required to pay a fee may restrict access to some investment products.”