The Target Market Determination (TMD) is a document that describes who a financial product is designed for and sets out the kids of customers the product is likely to suit, based on their objectives, financial situation and needs. It also explains who the product is not suitable for.
What's a TMD?
Product issuers must prepare a TMD under Australia's design and distribution obligations (Part 7.8A of the Corporations Act 2001). Issuers and distributors must then take reasonable steps to make sure the product reaches the customers it was designed for.
A TMD also sets out:
• How the product can be distributed
• The events or information that would prompt a TMD review
• How often it will be reviewed
• What information distributors must report back to the issuer.