RLP Training
  • 078 571 9945
  • 2nd Floor, HB Forum, <br> 13 Stamvrug Street, Val de Grace

Office Address

2nd Floor, HB Forum, 13 Stamvrug
Street, Val de Grace

Phone Number

078 571 9945

The Compliance Crackdown: What FSPs Are Doing Wrong in 2026

Shape Shape Shape

Over the past 12–18 months, there has been a noticeable shift in how compliance is being enforced across South Africa’s financial services industry.

It’s no longer just about having the right documentation in place, but rather about proving that your business actually understands and applies what the legislation requires.

And this is where many Financial Services Providers are being caught off guard.

The Reality Behind Compliance

From our engagements across the industry, one thing has become clear:

Most FSPs believe they are compliant until they are tested.

We are seeing the Financial Sector Conduct Authority (FSCA) are placing increasing focus on:

  • The competence of representatives

  • The application of legislation, not just theoretical knowledge

  • Evidence of ongoing training and supervision

This shift is exposing a critical gap.

The Competency Gap No One Is Talking About

Passing regulatory exams like RE5 or RE1 has become the benchmark for entry into the industry.

But passing an exam does not guarantee:

  • Practical understanding

  • Correct advice processes

  • Real-world compliance application

We are seeing a growing number of representatives who are technically qualified but operationally underprepared.

This creates risk not just for the individual, but for the FSP as a whole.

Where FSPs Are Most at Risk

Based on current industry trends, the biggest compliance risks lie in:

1. Supervision structures that exist on paper only
Many FSPs cannot demonstrate active, ongoing supervision.

2. Inconsistent advice processes
Client interactions are not always aligned with the requirements of the Financial Advisory and Intermediary Services Act (FAIS).

3. Lack of continuous professional development
Training is often treated as a once-off event, rather than an ongoing requirement.

4. Poor understanding of regulatory responsibility at management level
Key Individuals are not always equipped to manage compliance effectively.

What This Means for 2026

The direction is clear:

Compliance is moving toward accountability, evidence, and real competence.

FSPs that rely on outdated approaches like ticking boxes instead of building capability, will find themselves increasingly exposed.

What You Should Be Doing Now

To stay ahead, FSPs should focus on:

✔ Strengthening practical training, not just exam preparation
✔ Ensuring supervision is active and documented
✔ Bridging the gap between theory and real-world application
✔ Investing in ongoing development for both representatives and Key Individuals

Compliance is no longer a function but a culture.

And in the current environment, those who treat it as a checkbox exercise will struggle to keep up.

At RLP Training, we work closely with FSPs to bridge the gap between regulatory knowledge and real-world application — because passing the exam is only the beginning.