Financial Advisory Agreement (Singapore)
FINANCIAL ADVISORY AGREEMENT
Financial Advisers Act (Cap. 110), Singapore
This Financial Advisory Agreement is entered into on [Agreement Date] between:
(1) [Adviser Name] (FAA Licence: [FAA Licence Number], UEN: [Adviser UEN]) of [Adviser Address], represented by [Representative Name] (MAS Reg. No.: [Representative Reg]) (“the Adviser”); and
(2) [Client Name] (NRIC/FIN: [Client NRIC]) of [Client Address] (“the Client”).
Client Classification: [Client Classification]
1. SCOPE OF SERVICES
1.1 The Adviser agrees to provide the following financial advisory services to the Client: [Scope Of Services].
1.2 The Adviser shall conduct a needs analysis and assess the suitability of any recommendation for the Client in accordance with Section 27 of the Financial Advisers Act (Cap. 110) and MAS Notice FAA-N16 (Recommendations on Investment Products).
1.3 The Adviser’s appointed representative responsible for this account is [Representative Name] (Reg. No.: [Representative Reg]).
2. SUITABILITY AND RISK PROFILE
2.1 The Client’s investment risk profile is: [Risk Profile].
2.2 Investment Objective: [Investment Objective]
2.3 The Client agrees to notify the Adviser promptly of any material changes in their financial situation, investment objectives, or risk profile.
3. FEES AND REMUNERATION
3.1 Fee Structure: [Fee Structure].
3.2 Fee Details: [Fee Details]
3.3 The Adviser shall provide full disclosure of all commissions, fees, and other remuneration received from product providers in connection with any recommendation, as required by MAS Notice FAA-N03 (Disclosure on Product Information).
3.4 GST at the prevailing rate shall be added to any advisory fees.
4. ADVISER’S OBLIGATIONS
4.1 The Adviser shall act in the Client’s best interests at all times and comply with the Financial Advisers Act, MAS Notices and Guidelines, and the Financial Advisers Regulations.
4.2 The Adviser shall maintain the confidentiality of the Client’s personal and financial information and process such data in accordance with the PDPA 2012.
4.3 The Adviser shall provide the Client with a Product Summary and a Financial Needs Analysis before making any recommendation.
5. CLIENT ACKNOWLEDGEMENTS
The Client, [Client Name], acknowledges that:
- Investments involve risks and past performance is not indicative of future returns;
- The Client has read and understood the risk disclosures provided;
- The Client’s risk profile ([Risk Profile]) and investment objectives have been accurately stated;
- The Client is classified as a [Client Classification] for purposes of the Financial Advisers Act.
6. GOVERNING LAW
6.1 This Agreement is governed by the laws of Singapore. Any dispute shall be subject to the jurisdiction of the Singapore courts or, if agreed, the Financial Industry Disputes Resolution Centre (FIDReC).
Adviser (Authorised Representative)
________________
Signature
Client
________________
Signature
What Is a Financial Advisory Agreement (Singapore)?
A Financial Advisory Agreement in Singapore sets out the rights and obligations the parties agree to be bound by.
MAS regulates financial advisers through a licensing and exemption framework. Licensed financial advisers must hold a Financial Adviser's licence issued by MAS under Section 6 of the Financial Advisers Act. Exempt financial advisers — including banks licensed under the Banking Act 1970 (Cap. 19), merchant banks approved under the Monetary Authority of Singapore Act, and insurance companies registered under the Insurance Act (Cap. 142) — may provide financial advisory services without a separate FA licence, subject to compliance with the Financial Advisers Act's conduct requirements. Representatives of licensed and exempt FAs must be registered with MAS under the Representative Notification Framework and must satisfy the minimum competency requirements prescribed in MAS Notice FAA-N13.
The Financial Advisers Act and its subsidiary legislation — including the Financial Advisers Regulations (Cap. 110, Rg 2), MAS Notices FAA-N02 (Minimum Entry and Examination Requirements), FAA-N16 (Recommendations on Investment Products), and FAA-N20 (Fair Dealing) — impose detailed conduct obligations on FAs. Section 27 of the Financial Advisers Act requires FAs to have a reasonable basis for any recommendation made to a client, having regard to the client's investment objectives, financial situation, and particular needs. The MAS Guidelines on Fair Dealing (FAA-G11) further require FAs to deal fairly with all clients and to prioritise the client's interests over the FA's own commercial interests.
The Competition and Consumer Commission of Singapore (CCCS) monitors anti-competitive practices in the financial advisory industry, while the Financial Industry Disputes Resolution Centre Ltd (FIDReC) — an independent dispute resolution scheme approved by MAS — provides an avenue for clients to resolve complaints against financial advisers without litigation. The Securities and Futures Act (Cap. 289) governs the FA's obligations regarding dealings in capital markets products, while the Personal Data Protection Act 2012 (PDPA) applies to the FA's collection, use, and disclosure of client personal data.
The Securities and Futures Act (Cap. 289) creates additional regulatory obligations for financial advisers who deal in capital markets products, including unit trusts, exchange-traded funds, bonds, and structured products, on behalf of clients. FAs providing both advisory and dealing services must comply with the Securities and Futures Act licensing requirements (Capital Markets Services licence under Section 82) in addition to the Financial Advisers Act requirements. The dual regulatory framework creates layered compliance obligations that must be reflected in the Financial Advisory Agreement.
MAS Technology Risk Management Guidelines (TRM Guidelines) apply to financial advisers that use digital platforms, mobile applications, or robo-advisory algorithms to deliver financial advice. The TRM Guidelines require FAs to implement cybersecurity controls, data protection measures, and business continuity plans commensurate with the technology risks of their advisory model. Financial Advisory Agreements for digitally delivered services must address the technology-specific risks, including algorithmic errors, system outages, and data breaches, that are unique to technology-enabled financial advisory.
When Do You Need a Financial Advisory Agreement (Singapore)?
A Financial Advisory Agreement in Singapore is needed whenever a licensed financial adviser or exempt financial adviser provides advice on investment products, insurance, retirement planning, or wealth management to a client, and both parties require a documented framework governing the scope, fees, and obligations of the advisory relationship.
Individual investors engaging a financial adviser for personal wealth management, retirement planning, or estate planning need a written agreement specifying the services covered (investment advice, insurance planning, CPF optimisation, tax planning), the fee structure, and the adviser's obligations regarding suitability assessment and disclosure. MAS Notice FAA-N16 requires financial advisers to conduct a needs analysis before recommending any investment product — the Financial Advisory Agreement documents this process and the client's risk profile.
High-net-worth individuals (HNWIs) — classified as "accredited investors" under the Securities and Futures Act (Cap. 289) Section 4A if they have net personal assets exceeding S$2 million (or S$1 million excluding their primary residence) or income in the preceding 12 months of not less than S$300,000 — may opt out of certain MAS protections by electing accredited investor status. The Financial Advisory Agreement must record the client's accredited investor status and the specific protections waived, as required by MAS regulations.
Corporate clients engaging financial advisers for corporate finance advisory, fund-raising advice, or treasury management need agreements that address the adviser's scope of work, the information the client must provide, the adviser's duty of confidentiality regarding the client's financial position, and the allocation of liability for investment losses. The Financial Advisers Act Section 36 requires FAs to disclose material conflicts of interest to corporate clients — the agreement should incorporate these disclosure obligations.
Insurance advisory relationships — where the FA advises on life insurance, general insurance, or health insurance products — require written agreements addressing the FA's status (whether acting as an agent of the insurer or as an independent adviser), the commission structure, and the FA's duty to recommend only suitable products under MAS Notice FAA-N16. The Life Insurance Association Singapore (LIA) and the General Insurance Association of Singapore (GIA) have industry codes of practice that FAs must follow.
Robo-advisory services provided by digitally licensed financial advisers — operating under MAS's digital FA licence framework — require client agreements that address the automated nature of the advice, the algorithm's investment methodology, the limitations of algorithmic advice, and the client's acknowledgment of the technology risks. MAS has licenced several robo-advisers including StashAway, Syfe, and Endowus, each operating under the Financial Advisers Act framework.
What to Include in Your Financial Advisory Agreement (Singapore)
A Singapore Financial Advisory Agreement compliant with the Financial Advisers Act (Cap. 110), MAS Notices, and the Securities and Futures Act (Cap. 289) must address the following essential elements.
Party identification must state the financial adviser's full legal name, UEN, MAS FA licence number (or exempt FA status and the relevant exemption provision), and registered address. The client's full name, NRIC or passport number (for individuals) or UEN (for corporate clients), and contact details must be recorded. For representatives providing the advisory services, the representative's name and MAS Representative Number must be stated. The forms-legal.com Financial Advisory Agreement template includes all MAS-required identification fields.
Scope of services must define the specific financial advisory services covered — investment advice, insurance advice, retirement planning, estate planning, tax advisory (in connection with investment products), or portfolio management. The agreement must distinguish between advisory services (where the client makes the final investment decision) and discretionary management services (where the FA makes investment decisions on the client's behalf) — as these attract different regulatory obligations under the Financial Advisers Act and the Securities and Futures Act.
Suitability and risk profiling provisions must document the client's investment objectives (capital growth, income generation, capital preservation), risk tolerance (conservative, balanced, aggressive), investment time horizon, financial situation (income, assets, liabilities), and investment experience. MAS Notice FAA-N16 requires FAs to conduct a reasonable basis assessment before recommending any investment product — the agreement should incorporate the client's risk profile as an appendix or schedule, updated periodically.
Fee and commission disclosure must comply with MAS Notice FAA-N03 (Information to Clients) and the Financial Advisers Regulations. The agreement must disclose: the FA's fee structure (flat fee, percentage of assets under advice, hourly rate, or commission-based); all commissions received from product providers (trailer fees, initial commissions, renewal commissions); any referral fees or soft dollar arrangements; and the total cost of the advisory relationship over a projected period. MAS requires FAs to present fee information in a clear, standardised format that allows clients to compare costs across advisers.
Client obligations must specify the client's duty to provide accurate and complete financial information, to update the FA on material changes in financial circumstances, and to make independent investment decisions (in advisory relationships). The agreement should state that the FA's advice is based on information provided by the client and that the FA is not liable for advice given in reliance on inaccurate or incomplete information.
Conflict of interest disclosure must identify and manage potential conflicts under Section 36 of the Financial Advisers Act. Common conflicts include: the FA receiving higher commissions for recommending certain products; the FA's proprietary interest in recommended products; and the FA's relationship with product manufacturers. The agreement must state how the FA manages these conflicts — typically through disclosure, the use of approved product lists, and internal compliance oversight.
Confidentiality and PDPA compliance must address the FA's obligations regarding client personal data under the Personal Data Protection Act 2012 (PDPA) and MAS Notice FAA-N13. The FA must obtain the client's consent to collect, use, and disclose personal data for the purpose of providing financial advice, and must implement data protection measures consistent with the PDPC's Advisory Guidelines. Client financial information shared with product providers (insurers, fund managers) must be disclosed only with the client's express consent.
Liability and disclaimers must address the allocation of investment risk — the agreement should clearly state that the FA does not guarantee investment returns, that past performance is not indicative of future results, and that the client bears the risk of investment losses. However, liability exclusion clauses cannot exclude the FA's liability for breach of statutory obligations under the Financial Advisers Act or for fraud, negligence, or wilful misconduct.
Dispute resolution should specify the mechanism for resolving disagreements — typically mediation through the Financial Industry Disputes Resolution Centre (FIDReC) for claims up to S$100,000, or arbitration through the Singapore International Arbitration Centre (SIAC) for larger claims. The agreement should inform the client of their right to complain to MAS and to the FIDReC.
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title = {Financial Advisory Agreement (Singapore) (Singapore)},
year = {2026},
howpublished = {\url{https://forms-legal.com/singapore/financial/agreements/financial-advisory-agreement-singapore}},
note = {Free legal document template. Based on Bills of Exchange Act (Cap. 23)}
}Also available for these jurisdictions:
Frequently Asked Questions
Financial advisers in Singapore must hold a Financial Adviser's licence issued by the Monetary Authority of Singapore (MAS) under Section 6 of the Financial Advisers Act (Cap. 110), unless they qualify for an exemption under Section 23 of the Act.
Licensed financial advisers are firms (not individuals) that have applied for and received an FA licence from MAS, satisfying capital requirements (minimum S$250,000 paid-up capital for corporate FAs), professional indemnity insurance requirements, and competency standards for key officers. Representatives (the individuals who provide advice to clients) must be registered with MAS through the Representative Notification Framework and must pass the prescribed examinations — including the Capital Markets and Financial Advisory Services (CMFAS) modules specified in MAS Notice FAA-N13.
Exempt financial advisers include banks licensed under the Banking Act 1970 (Cap. 19), insurance companies registered under the Insurance Act (Cap. 142), and merchant banks approved under the MAS Act. These institutions may provide financial advisory services without a separate FA licence, but must comply with the conduct requirements of the Financial Advisers Act, including the suitability obligation under Section 27.
Individuals who provide financial advice without being registered as representatives of a licensed or exempt FA commit an offence under the Financial Advisers Act, carrying penalties of a fine up to S$75,000 and imprisonment up to 3 years.
The suitability obligation is the central regulatory requirement imposed on financial advisers in Singapore. Section 27 of the Financial Advisers Act (Cap. 110) requires that a licensed or exempt financial adviser, when making a recommendation to a client regarding an investment product, must have a reasonable basis for the recommendation having regard to the information about the client's investment objectives, financial situation, and particular needs that the FA has obtained through due inquiry.
MAS Notice FAA-N16 (Recommendations on Investment Products) prescribes the detailed requirements for compliance. Before making any recommendation, the FA must: gather information about the client's financial situation, investment objectives, risk tolerance, and investment experience; analyse the client's needs based on the information gathered; recommend only products that are suitable for the client's specific circumstances; and document the basis for the recommendation.
The suitability obligation applies to all recommendations made to retail clients (non-accredited investors). Accredited investors under Section 4A of the Securities and Futures Act (Cap. 289) may elect to opt out of the suitability protection, but the FA must obtain written acknowledgment of the opt-out and its consequences.
Failure to comply with the suitability obligation may result in MAS enforcement action (reprimand, composition fine, licence revocation), civil liability to the client for investment losses, and complaints to the Financial Industry Disputes Resolution Centre (FIDReC).
Clients in Singapore have multiple avenues for resolving disputes with financial advisers, ranging from internal complaint processes to independent dispute resolution and court proceedings.
The first step is the financial adviser's internal complaint handling process. MAS Notice FAA-N02 and the MAS Guidelines on Complaints Handling (FAA-G01) require all licensed and exempt FAs to maintain a complaints handling framework, acknowledge complaints within 3 business days, and provide a substantive response within 4 weeks. Clients should submit complaints in writing to the FA's compliance officer.
The Financial Industry Disputes Resolution Centre (FIDReC) is an independent alternative dispute resolution scheme approved by MAS. FIDReC handles claims by individuals and small businesses against financial institutions (including FAs) for amounts up to S$100,000. The process involves mediation by a FIDReC case manager; if mediation fails, the dispute is referred to adjudication by a FIDReC adjudicator, whose decision is binding on the FA but not on the client (the client may still pursue court proceedings if dissatisfied). FIDReC charges are nominal — S$50 filing fee for the complainant.
Clients may also lodge complaints with MAS directly, which may investigate the FA for regulatory breaches under the Financial Advisers Act. MAS enforcement actions — including composition fines, licence suspension, and criminal prosecution — are separate from the client's civil remedies.
Financial advisers in Singapore use several fee structures, which must be disclosed to clients under MAS Notice FAA-N03 (Information to Clients) and the Financial Advisers Regulations.
Commission-based fees are the traditional model, where the FA receives commissions from product providers (insurers, fund managers) when the client purchases recommended products. Initial commissions on life insurance policies typically range from 40% to 100% of the first year's premium, with renewal commissions of 5% to 15% in subsequent years. Commissions on unit trusts and collective investment schemes typically include an initial sales charge of 1% to 5% and annual trailer fees of 0.25% to 0.75% of the client's invested amount.
Fee-based advisory charges the client directly for advice — typically a flat fee (S$500 to S$5,000 for a detailed financial plan), an hourly rate (S$150 to S$500 per hour), or a percentage of assets under advice (0.5% to 1.5% per annum). Fee-based advisers may rebate commissions received from product providers to the client, aligning the adviser's compensation with the client's interest rather than product sales.
Hybrid models combine elements of both — the FA charges an advisory fee and also receives commissions, with the commissions offset against the advisory fee. MAS encourages transparency in fee disclosure and has proposed enhanced fee disclosure requirements through industry consultations.
When a financial adviser gives unsuitable advice in Singapore — recommending investment products that do not match the client's risk profile, financial situation, or investment objectives — the client has several remedies.
Regulatory action: MAS may take enforcement action against the FA for breach of Section 27 of the Financial Advisers Act (Cap. 110) and MAS Notice FAA-N16. Enforcement measures include composition fines (financial penalties agreed without court proceedings), prohibition orders barring the representative from the financial advisory industry, and FA licence revocation. MAS publishes enforcement actions on its website as a deterrent.
FIDReC complaint: The client may file a complaint with the Financial Industry Disputes Resolution Centre for claims up to S$100,000. FIDReC mediators and adjudicators assess whether the FA's recommendation met the suitability standard and may award compensation for investment losses attributable to the unsuitable advice. FIDReC decisions are binding on the FA.
Civil claim: The client may commence civil proceedings against the FA for breach of the Financial Advisory Agreement (contract claim), breach of statutory duty under the Financial Advisers Act (statutory claim), or negligent advice (tort claim). The client must prove that the advice was unsuitable, that the client relied on the advice, and that the client suffered financial loss as a result. Damages typically cover the difference between the client's actual investment outcome and the outcome that would have resulted from suitable advice.
This template is provided for informational purposes only and does not constitute legal advice. Laws vary by jurisdiction and change over time. Consult a qualified attorney for advice specific to your situation.Full disclaimer
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