AFSL Application Guide

Prepared by AFSL Express – Your Licensing Compliance Partner

Applying for an Australian Financial Services Licence (AFSL) is a detailed process that requires careful planning, correct documentation, and responsible supervision. This guide outlines the core steps and current ASIC expectations to help you prepare for a successful AFSL application in 2025.

1. Define Your Licensing Purpose

Before you begin, you must be clear about why you are applying. ASIC expects applicants to demonstrate a genuine operational need for the licence. If your model includes unusual combinations of services or newer product types, such as crypto or carbon credits, legal advice is recommended.

2. Identify the Required Authorisations

You must determine:

• Which financial products you will offer (e.g. securities, managed investment schemes, margin lending).

• Which financial services you will provide (e.g. general or personal advice, dealing, custodial services).

• Whether you will service retail clients, wholesale clients, or both.

These choices define the authorisations you will request in your application.

3. Decide Who Will Hold the Licence and Nominate Responsible Managers

You must confirm:

• Whether the licence holder will be a company, trust, or partnership.

• The individuals who will act as Responsible Managers (RMs).

What is a Responsible Manager?

Responsible Managers demonstrate the competence of the licensee. They do not need to be directors. They may be employees or contractors with direct experience in the proposed services. ASIC assesses RMs based on five options in Regulatory Guide 105 (RG 105).

This generally includes:

• Holding a relevant tertiary qualification.

• Having three of the past five years’ experience providing the relevant services.

RMs are expected to contribute to the licensee’s compliance culture. They must understand the scope of authorisations and support the business in supervising its financial services.

4. Prepare Core Proof Documents

You must provide several key documents:

Business Description

• Explain your business model, services, client types, service channels, and revenue expectations.

• Include a sample transaction to demonstrate your operational understanding.

Table of Organisational Expertise

• Outline each RM’s skills, experience, and proposed responsibilities.

Supporting Documents for RMs

• Copies of qualifications.

• Personal statement confirming willingness to act.

• Two professional references dated within the past 12 months.

Fit and Proper Declarations

• Personal statements for directors, RMs, and controllers.

• National police checks.

• Bankruptcy checks (all less than 12 months old).

ASIC expects these individuals to meet the fit and proper person test.

5. Financial Resources Requirements

You must demonstrate the business is financially prepared:

• Provide signed financial statements no older than three months.

• Include forward-looking 12-month cash flow projections.

• Explain how you will meet ASIC’s financial requirements under RG 166.

6. Additional Proof Documents

Depending on the authorisations requested, ASIC may require:

• A monitoring and supervision plan if you will have representatives.

• A risk management framework.

• External dispute resolution (EDR) membership (e.g. AFCA) if advising retail clients.

• Professional indemnity insurance that meets RG 126.

If applying for personal advice authorisations, ASIC may require more detail about your documentation, systems, and representative training.

7. Lodging the Application

AFSL applications are submitted through ASIC’s eLicensing portal. The portal asks for declarations confirming you have systems, documents, and procedures in place. ASIC may request further clarification or additional non-core proofs during the assessment.

Processing time is usually between 4 and 6 months, although complex applications can take longer. ASIC may contact you with follow-up questions or requests for updated information.

8. Before You Receive Final Approval

Prior to licence approval, you may be asked to:

• Strengthen financials or provide updated forecasts.

• Finalise your insurance policy and AFCA membership.

• Confirm internal procedures for compliance, training, and supervision.

If you will serve retail clients, you must have compliant disclosure documents, privacy practices, and dispute resolution systems in place.

9. Should You DIY or Outsource?

You can manage the application yourself, but this requires in-depth regulatory understanding and internal capacity. Many firms outsource all or part of the process to reduce risk and save time. You can also prepare most of the application internally and seek a review before submission.

10. Consider Other Options

For small teams or startup businesses, becoming a corporate authorised representative of an existing licensee can be a cost-effective interim solution. This allows you to operate under another AFSL while building your track record and systems.

Final Thoughts

ASIC assesses each application carefully. The most successful applications come from businesses that understand the obligations involved in holding an AFSL. Being thorough, accurate, and responsive helps reduce delays and increases your chance of success.

AFSL Express provides compliance support, proof document templates, and Responsible Manager services for financial service providers across Australia.

AFSL Express – Helping you turn licensing into your advantage.