How to become a Key Individual in South Africa (and where the RE1 fits)

To be approved as a Key Individual you must meet the six fit and proper requirements in Board Notice 194 of 2017 and pass the RE1 exam first. The RE1 is 80 questions, and 52 correct, which is 65%, meets the standard. Unlike representatives, Key Individuals get no post-appointment grace period.

Somewhere between the experienced adviser and the person who runs the business sits a role most people only half understand until they are asked to take it: the Key Individual. If someone has just told you that you need to become a KI, this is what the job actually requires and where the RE1 exam fits into it.

What a Key Individual is, in one paragraph

A Key Individual is the person the regulator holds responsible for the management and oversight of an FSP's financial services. Not the person advising the client: the person answerable for how the advising is run. That is why the RE1 exists as a separate paper from the RE5, and it is the whole reason this process is as involved as it is. What the role actually involves day to day, and what you become personally liable for, is set out in key individual responsibilities and liability. This page is about how you get approved. Because the exam has to be passed before the FSCA will approve you, preparation is the first step rather than the last: an RE1 practice exam should mark you against 52 of 80.

What you have to satisfy, in summary

Approval rests on the FAIS fit and proper requirements in the Determination of Fit and Proper Requirements (Board Notice 194 of 2017). There are six: honesty and integrity, good standing, competence (which is where the RE1 sits, alongside a recognised qualification and relevant experience), continuous professional development, operational ability, and financial soundness.

Each of those has detail underneath it, and the detail is what decides whether your application is straightforward or not: which qualifications count, how much management experience each licence category needs, and what counts against you on good standing. All six are worked through as a checklist on key individual requirements, which is the page to read if what you need is the standard itself. The rest of this page is about the order you do things in.

Where does the RE1 fit, and when should you write it?

The RE1 is the regulatory examination for Key Individuals. It is written through Moonstone, in person, and the pass mark is 65%, which is 52 of the 80 questions. It sits inside the competence requirement, with one narrow carve-out: it does not apply to a Category I FSP and its Key Individuals approved only for long term insurance subcategory A or friendly society benefits. Outside that, the RE1 is not optional.

Timing is where people cost themselves months, usually because they are planning around the wrong rule. Representatives get a 24 month runway from their date of first appointment, because they may work under supervision while they prepare. Key Individuals get no such runway: under Board Notice 194 of 2017 the exam must be passed before authorisation, approval or appointment. There is no post-appointment grace period.

That flips the planning question rather than removing it. No regulatory clock is chasing you, but nothing waits for you either. Every month the RE1 goes unwritten is a month the appointment or the licence application sits on hold. Writing it early is not just the smarter order, it is the order the determination requires.

Why does the RE1 catch experienced people out?

Here is the pattern we see. Someone with fifteen years of solid advice experience assumes the RE1 will be a formality, because they know the industry cold. Then they fail, and they are genuinely surprised.

The reason is that the RE1 is not a harder version of the RE5. It is a different vantage point. The RE5 asks what a representative may do. The RE1 asks what a Key Individual must ensure, monitor, record and report. Long practical experience helps, but it also creates blind spots, because you know how your firm does things, which is not the same as knowing what the legislation requires in general.

Experience makes you confident. Confidence is not readiness. The only reliable way to tell the difference is to measure yourself against the criteria the exam actually tests, before you book. Our guide on knowing when you are ready goes deeper, and it applies with more force to the RE1, because senior people are the least likely to be told they are underprepared.

What does a realistic path to approval look like?

The sequence that works, roughly. Confirm which licence categories you will oversee, because your qualification and experience requirements follow from that. Check your qualification against the current recognised list, and be honest about whether your experience matches the categories. Pass the RE1, remembering it has to be done before approval rather than after. Then the FSP submits your application, with the supporting evidence, and the FSCA assesses it. Build in more time than you expect for the paperwork, and document as you go, because your firm's competence records will be looked at too.

If you are the person building those records for other people as well, our guide on what belongs in a competence register covers what to keep and how.

What does preparation actually look like?

Reading the material end to end is the default approach and the weakest one. The RE1 draws on a defined set of qualifying criteria, and a fail almost always comes down to two or three that were never properly understood, not a general lack of knowledge.

So prepare in the reverse order to what feels natural. Measure first, which shows you which criteria are actually weak. Study those. Then prove it with timed practice under exam conditions, because knowing the answer at your own pace is not the same as producing it in the room. PassPath measures RE1 readiness against every qualifying criterion and maps where you stand topic by topic. The free readiness check takes about 15 minutes, no card needed, and it will tell you quickly whether your experience has translated into exam readiness.

PassPath is an independent study platform. The RE1 is written through Moonstone; PassPath is not affiliated with Moonstone or the FSCA.