Date
4 December 2016
The growth of China’s investors’ appetite for overseas assets and the rise of fintech will bring profound changes to the role of financial planners. Photo: coindesk.com
The growth of China’s investors’ appetite for overseas assets and the rise of fintech will bring profound changes to the role of financial planners. Photo: coindesk.com

Opportunities and challenges for Chinese financial planners

Cai Chongzhi, vice chairman of the Financial Planning Standards Board China Advisory Committee, spoke on how to beef up the competitiveness of China’s certified financial planners during the China CFP Summit 2016.

Here are some of the key points of his speech:

Over 80 percent of China’s high-net-worth individuals have already invested overseas or intend to invest overseas within three years.

Hence, financial planners must have enough knowledge not only about investments, but also about overseas insurance policy, overseas property, and global tax planning, among other matters.

The Financial Planning Standards Board China Advisory Committee has signed a cooperation agreement with the Institute of Financial Planners of Hong Kong and the Financial Planning Association of Singapore to set up cross-border certification programs to help financial planners get ready for such challenges.

Meanwhile, cracking down on tax evasion has become a global trend since the 2008 financial crisis.

Last year China signed the Multilateral Competent Authority Agreement on Automatic Exchange of Financial Account Information.

The agreement commits the 97 signatories to an automatic exchange of information with Chinese tax authorities for tax purposes.

It would have a great impact on Chinese nationals with overseas financial accounts.

From September 2018, China will start providing information on foreign residents in China to other signatory countries while receiving information on overseas accounts of Chinese nationals.

The automatic information exchange mechanism implies a sea change in traditional offshore asset planning.

The application of new technology such as big data, artificial intelligence and cloud computing will become more widespread in the financial sector.

That too will bring tremendous changes to the financial planning industry.

Information will become more easily accessible and asset allocation will get more automated.

That means customers will become more demanding when it comes to financial planning services.

This article appeared in the Hong Kong Economic Journal on Nov. 18.

Translation by Julie Zhu

[Chinese version 中文版]

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RT/CG

Founder and Managing Director of Pegasus Fund Managers Ltd.

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