LESSON 02 · 17:54 VIDEO
Advice vs intermediary services.
A recommendation and the work of carrying out a transaction are different activities. Learn to spot the difference in everyday client interactions.
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What you’ll learn
- Identify a recommendation even when no sale follows.
- Separate factual information from guidance to a client.
- Avoid assuming that all administrative work is excluded.
Advice starts with the recommendation
Advice includes financial recommendations, guidance or proposals to a client or group of clients concerning a financial product. It can concern buying, investing, changing, replacing or terminating a product. A recommendation need not lead to a transaction to fall within the definition.
Information is not always advice
The Act contains exclusions, including certain purely factual information and routine administrative answers. Compare “Your premium is R300” with “You should replace your policy with this one”. The first states a fact; the second guides a product decision. An implied recommendation can matter too, so read the whole conversation.
Intermediary services are a separate activity
Work such as handling a product transaction or processing a claim may be an intermediary service, depending on the statutory definition and exclusions. A person can perform an intermediary service without recommending anything. Saying “I did not advise the client” does not by itself place the activity outside FAIS.
Try the distinction
Naledi recommends a particular policy after discussing a client’s needs, then helps submit the application. The recommendation is advice. The application work must be assessed separately as a possible intermediary service. One client journey can contain both services.
Watch the administration shortcut
Do not assume that everything described as “admin” is exempt. The exclusion for subordinate clerical, technical or administrative work in the definition of representative has conditions. Identify the actual task, any judgement involved and the relevant exclusion rather than relying on the employee’s job title.
Sources & further reading
FAIS Act, section 1 definitions and section 1(3) exclusions. These are short study notes to accompany the video, not a word-for-word transcript.
RE5 Master learning notes · Updated 2 November 2026. Use current official material alongside your revision.