Industry funds urge super onboarding advertising | Australian Markets

Only MySuper superannuation funds which have handed the latest Australian Prudential Regulation Authority (APRA) efficiency take a look at ought to be capable of promote to draw new members, in line with industry funds group, Super Members Council (SMC).

The SMC has famous to Treasury that quite a few superannuation onboarding platforms have emerged as half of the drive in direction of Payday Super and desires limitations positioned on which funds can promote on these platforms to draw members.

It has additionally argued that precedence needs to be given in such advertising to present default and stapled funds.

“The growing adoption of onboarding platforms with payday super capability underscores the importance of ensuring strong consumer protections provided by default super funds,” it mentioned.

“Consistent with our organisation’s purpose to protect and advance the interests of super fund members, SMC considers the proposed approach to only permit MySuper products that have passed the latest annual APRA performance test to be advertised on onboarding platforms to be a material improvement on the status quo,” the SMC submission mentioned. “

Numerous submissions made to Treasury’s Securing Australians’ Superannuation session paper highlighted critical shopper dangers if such advertising continues unregulated, together with undermining important work to forestall the proliferation of unintended duplicate accounts within the super system.”

“While the exposure draft legislation introduces a planned restriction on the type of fund that can engage in advertising during onboarding, there is no regulation of how that advertising can be presented. This still leaves open a door to potential consumer harm,” the SMC mentioned.

“We recommend that regulations contemplated in the draft Section 992AB(3)(d) amendments to the Corporations Act 2001 (Treasury Laws Amendment Bill 2025: ban on advertising super funds during onboarding) set out clear rules on presentation of such advertising, including requiring an employee’s stapled fund, and the relevant default fund, to be presented – and for these to be presented with higher prominence than other advertised funds.”

“As famous within the Explanatory Materials, the rules are anticipated to incorporate necessities to obviously label advertising materials, embody acceptable disclaimers and disclose any charges or funds, amongst different issues. Disclosures also needs to embody warnings concerning the impression altering funds might have on insurance coverage preparations.

“The rules also needs to require that onboarding systems that characteristic adverts embody a hyperlink to the ATO YourSuper Comparison Tool, to guard super fund members from making uninformed selections.

“The addition of reasonable restrictions in the regulations will ensure that the interests of members are supported in the choice of fund process and will minimise risks of consumer harm, including the proliferation of unintended duplicate accounts,” the submission mentioned.