The Ministry of Business, Innovation and Employment has made public the submissions it received on its Financial Advisers Act review options paper.

One of the packages of options proposed included new rules that would separate financial advice from sales.

That had widespread support from much of the industry, but not banks.

All of the big four banks argued against such a change.

BNZ said finding a suitable definition to distinguish sales from advice would be a challenge.

ASB said it was not necessary because any salesperson should be satisfied they were selling a product that met a customer's needs. It said any new category of sales would corrupt the definition of advice. The key was to make sure consumers understood the scope of advice they were being offered, it said.

ANZ said the delineation would make things more complicated for consumers, not easier.

"The proposal that salespeople provide a prescribed notice to the effect that they are not required to act in the consumer's best interest would make the sales regime very unattractive. The proposed warning will also be confusing for consumers in the context of the proposal that the salesperson must nonetheless ensure that the product is suitable. The use of the warning may drive financial services providers towards an information-only model," Westpac said.

Banks are currently operating as qualifying financial entities (QFEs), which means they take responsibility for their own advisers.

The banks were also supportive of being allowed to continue with that, instead of moving to a model that puts the same requirements on all advisers, as has been supported by others in the industry.

ANZ argued QFEs should be given more powers - it wants its staff to be able to provide financial advice across any product and without having to worry about whether the advice is personalised or class.

BNZ said it would not be right for QFE staff to be given a requirement to put a client's interests first. "Such a duty would be analogous to a person going to a specific brand of car dealership and being required to be offered details on cars produced by other manufacturers to determine the absolutely best-matched car for the consumer."

Many submissions said the options paper had not acknowledged that a hurdle to consumers getting advice was that many did not understand why they needed it.

“ASB KiwiSaver Scheme customers can obtain free three personalised advice in connection with the scheme from an AFA, but less than 1% of these customers actually access this resource,” ASB wrote.