Few in RI turn to financial advisers

Yuli Tri Suwarni, The Jakarta Post, Bandung

Few people in Indonesia make use of financial advisers, with only 1 percent of the country's five million middle-class families availing themselves of the services of a financial adviser.

The chairman of the International Association of Registered Financial Consultants (IARFC) Indonesia, Aidil Akbar Madjid, said that ideally a middle-class family with monthly expenditures of over Rp 1 million (US$104.50) should use a financial adviser to manage their future investments.

"It is understandable if the demand for financial advisers remains low since the profession was only introduced here in 2000. Previously, only the haves used financial advisers to manage their assets," he said during a recent customer and media gathering hosted by state Bank BNI.

One of the obstacles to increasing the use of financial advisers is that many insurance agents and bank tellers pretend to be financial advisers and tell their clients to use their respective company's products, he said.

Akbar said a financial adviser should be independent and should not promote the products of a certain bank or insurance company.

According to Akbar, there are only 102 internationally accredited independent financial advisers in Indonesia, with most of them working in Jakarta. Their consultation fees range from Rp 1.5 million to up to Rp 20 million.

Besides managing a family's finances, financial advisers help clients select their investments.

"Each financial adviser will give their clients a guideline on what to do with their money," Akbar said.

Beginning in July this year, BNI will deploy 134 financial advisers at its offices to provide free consultations on financial management and investment to customers.

"For the time being, the 134 financial advisers will be deployed at BNI's branches in the Greater Jakarta, Bandung, Semarang and Surabaya," said Adi Setyanto, general manager of BNI's Bancassurance program.