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What Fit and Proper actually means
Fit and Proper is the FSCA's framework that decides whether you may operate as an FSP, a Key Individual or a Representative. It covers five core areas: honesty and integrity, competence, operational ability, financial soundness and continuous professional development. You have to meet all five, not just one.
Honesty and integrity looks at your personal record, including any history of dishonesty, fraud or insolvency. Competence covers your qualification, your Regulatory Exam, your class of business training and product specific training. Operational ability and financial soundness apply mostly to the FSP itself.
CPD ties the whole framework together by making sure that once you are qualified, you keep learning. The point of Fit and Proper is that being qualified once is not enough. You stay qualified by keeping current.
How the requirements have changed
When the FAIS Act first came into force in 2004, the focus was largely on getting a recognised qualification and writing your Regulatory Exam. The early framework was less prescriptive on ongoing learning and on the way Key Individuals had to demonstrate active oversight.
In 2017 the FSCA, then still the FSB, issued Board Notice 194 of 2017. This brought in a far more detailed Fit and Proper regime. It set out a structured CPD framework, formal class of business training, product specific training requirements and clearer expectations for Key Individuals. Transitional arrangements followed, and the industry has been adjusting ever since.
The result is that the bar today is meaningfully higher than it was ten years ago. Compliance officers expect tighter records, ongoing learning and clearer evidence that Representatives are competent for the specific products and classes of business they handle.
What it means for you
For Representatives, the practical impact is that you cannot rely on a qualification you earned years ago. You need to be able to show your full qualification at the right NQF level, your completed Regulatory Exam, your class of business training and product specific training, and your CPD hours for the current cycle.
For Key Individuals, the framework also expects you to actively oversee your Representatives and to keep records that show you are doing so. A clean Fit and Proper position is one of the most valuable career assets a senior person in financial services can have.
For employers, Fit and Proper is a key screening lens. A candidate who can clearly evidence their Fit and Proper position will move through onboarding faster, and will reduce the regulatory risk the FSP carries.
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