Exam Credit and Exam Validity

Per FINRA Rule 1220, individuals are required to pass an appropriate exam or receive a waiver to qualify for a registration category. After passing an exam, the individual must obtain approved status in a corresponding registration category within two years (four years for the SIE) of the exam date to maintain its validity. If an individual does not obtain an approved registration within the two- or four-year validity period, the exam's validity will expire.

Under certain circumstances, an individual may receive an exam "Credit." To learn more about exam credit and validity criteria and scenarios, review the information below. 

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Exam Credit 

The exam status of “Credit” was introduced in October 2018 with the Securities Industry Essentials® (SIE®) Exam and the revised representative-level registration exams. Individuals who had previously passed certain representative-level exams and who held, or had held, the associated registration during the most recent four years, were given a “Credit” for the SIE exam to indicate that they were qualified for the associated registration and did not have to pass the SIE exam.
 
More recently, in January 2023, the exam status of “Credit” became available for another situation. Each registration has a default base qualification exam, which is the exam that an individual must pass to become qualified to hold the registration (some registrations also require an individual to pass the SIE exam). For example, the Series 7 or Series 7 top-off (S7 or S7TO) exam is the default base exam for the General Securities Representative (GS) registration. However, in some situations, an individual may have passed an exam other than the default base exam to become GS-registered. At times, situations like these have led to confusion as to whether an individual is appropriately qualified to hold a registration. Therefore, to more clearly display that an individual is qualified to hold a registration, FINRA added the default base qualification exam(s) with a status of “Credit” to certain individual’s CRD records. Starting Jan. 2, 2023, individuals had an exam credit added to their record if they held a registration (or had held it within the most recent two years) but did not have a default base qualification exam.   

Credit Examples

S7TO credit can be granted in the following scenarios:

  1. An individual obtained a GS registration by passing alternate equivalent exams (e.g., Series 1).
  2. An individual enrolled in the Maintaining Qualifications Program (MQP) to maintain their Series 7 qualification.
  3. A firm filed an application for the GS with a valid S7/S7TO within the two-year termination period, but GS approval was obtained after the end of the two-year termination period, at which time the S7/S7TO validity had expired.

SIE credit can be granted in the following scenarios:

  1. An individual was granted credit in 2018 at the time of the introduction of the SIE Exam.
  2. An individual enrolled in the MQP to maintain their Series 7 qualification.
  3. A firm filed an application for a representative-level registration (such as a GS) with a valid SIE within the SIE four-year termination period, but registration approval was obtained after the end of the four-year termination period, at which time the SIE validity had expired.

 

Exam Validity

Per FINRA Rule 1210.08 – Lapse of Registration and Expiration of SIE, an individual is required to pass a representative- or principal-level qualification exam appropriate to the registration category as specified in FINRA Rule 1220. The passed exam result is valid for two years (four years for the SIE), in which time the individual must obtain an approved registration status in an appropriate representative or principal category to maintain validity. If an individual does not obtain an approved registration within the two- or four-year validity period, the qualification will lapse, and the validity will expire. Once “Expired,” the exam no longer qualifies for a registration, and the individual will be required to pass the exam(s), or receive waiver(s), to obtain a qualification.

While a qualification is registered, the exam status will remain valid without an expiration date. Once a registration is terminated via a partial or full Form U5 filing, the exam status will reflect a “valid until xx/xx/xxxx” date that is the two-year (or four-year for the SIE) validity period from the termination date. Obtaining an approved registration within the valid period will reset the validity without an expiration date.

Validity is also impacted by continuing education (CE) status. If an individual fails to complete their assigned CE, their registration will be designated CE inactive, and the validity will start to count down for two consecutive years before it expires.

Note: Validity for qualifications obtained by exam waiver and exam credit follow the same rules. 

 

Validity Examples

S7/S7TO

1)    Upon passing or receiving credit or waiver of the Series 7/7TO exam, an individual will have a valid exam for two years to qualify them for a registration.
2)    Validity may be maintained beyond two years by obtaining GS registration:
a)    Once an individual becomes GS registered, the S7/S7TO will remain valid as long as they hold that registration.
b)    Once an individual ceases being GS registered, the S7/S7TO will remain valid for two years from the date of termination on the Form U5.
3)    An individual who is enrolled in the MQP can have the validity of their qualification extended for up to five years beyond the termination date.

SIE

1)    Upon passing or receiving a credit or a waiver for the SIE exam, the exam is valid for four years to qualify an individual for a registration.
2)    Validity may be maintained beyond four years by obtaining a registration that the SIE is a qualifier for:
a)    Once an individual becomes registered (in any of the registrations requiring the SIE), then the SIE will remain valid as long as the individual holds that registration; or
b)    Once an individual ceases being registered (in any of the registration categories that requires the SIE), then the SIE will remain valid for four years from the date of termination on the Form U5.
3)    An individual who is enrolled in the MQP can have the validity of their qualification extended for up to five years beyond the termination date.

 

FAQ

Q: When I reviewed the Qualifications area of my record in FinPro, I saw that some of my exams have an exam status of “Credit” in the Exam History section. What does this mean?

A: A valid exam with an exam status of “Credit” indicates that the individual is qualified for the registration(s) associated with the exam. For the purpose of qualifying an individual for a registration, it is the equivalent of passing the exam or receiving a waiver of the exam. 

The following FAQ are examples of the most common situations in which an exam credit was added to an individual’s record.

 

Series 6TO Credit  

Q: In 2015, I passed the Series 7 exam and was registered as a General Securities Representative (GS). My GS was terminated in 2020, and my firm registered me as an Investment Company and Variable Contracts Products Representative (IR). I was qualified to be an IR because I had a valid Series 7 at the time. Recently, when I reviewed the Qualifications area of my record in FinPro, I saw that I now have an entry for the Series 6TO exam with an exam status of “Credit” in the Exam History section. Additionally, my Series 7 exam is now expired. What does this mean? 

A: Each registration has a default base qualification exam, which is the exam that an individual must pass to become qualified to hold the registration. Currently, the Series 6 exam is the default base exam for the IR registration. (“S6TO” is shorthand for the Series 6 top-off version of the exam. FINRA began to administer the Series 6TO in October 2018 after the representative-level exam restructure.) The Series 7 exam also qualifies an individual for the IR.
 
On occasion, FINRA has received inquiries as to whether an individual who qualified for the IR registration without passing the Series 6 exam is appropriately qualified to hold an approved IR registration. Therefore, to more clearly display that an individual is qualified to hold the IR registration, FINRA added a Series 6TO entry with an exam status of ”Credit” to certain individuals’ CRD records. Starting on January 2, 2023, individuals had a S6TO credit added to their record if they held the IR registration (or had held it within the most recent two years) but did not have a valid Series 6 or Series 6TO exam.
 
This entry in the Exam History section of your record represents that you are qualified to hold the IR registration just the same as if you had passed the Series 6TO exam. In addition, because you have not held the GS registration for more than two years, the Series 7 exam no longer qualifies you to hold the GS. Therefore, the exam validity status was updated to “Expired” for the Series 7.
 

Series 7TO Credit  

Q: I have been registered as a General Securities Representative (GS) since the 1970s when I passed the Series 1 exam. Recently, when I reviewed the Qualifications area of my record in FinPro, I saw that I now have an entry for the Series 7TO exam with an exam status of “Credit” in the Exam History section. Additionally, my Series 1 exam is now expired. What does this mean? 
 
A: Each registration has a default base qualification exam, which is the exam that an individual must pass to become qualified to hold the registration. Currently, the Series 7 exam is the default base exam for the GS registration. (“S7TO” is shorthand for the Series 7 top-off version of the exam. FINRA began to administer the Series 7TO in October 2018 after the representative-level exam restructure.) The Series 1 exam was a precursor to the Series 7 exam, and it was retired in 1980. (Visit the Implementation and Amendment Dates of Qualification Exams page for more information.) 
 
On occasion, FINRA has received inquiries as to whether an individual who qualified for the GS without passing the Series 7 exam is appropriately qualified to hold an approved GS registration. Therefore, to more clearly display that an individual is qualified to hold the GS, FINRA added a S7TO entry with an exam status of “Credit” to certain individuals’ CRD records. Starting on January 2, 2023, individuals had a S7TO credit added to their record if they held the GS registration (or had held it within the most recent two years) but did not have a valid Series 7 or Series 7TO exam.
 
This entry in the Exam History section of your record represents that you are qualified to hold the GS registration just the same as if you had passed the Series 7TO exam. Because the Series 1 exam is no longer available to qualify you for the GS, it now has an exam validity status of “Expired.” 
 

Series 57TO Credit  

Q: I have been registered as a Securities Trader (TD) since 2016, when the registration was first introduced. Prior to that I was registered as a Proprietary Trader (PT) and qualified for it by passing the Series 7 exam. Recently, when I reviewed the Qualifications area of my record in FinPro, I saw that I now have an entry for the Series 57TO exam with an exam status of “Credit” in the Exam History section. What does this mean? 

A: Each registration has a default base qualification exam , which is the exam that an individual must pass to become qualified to hold the registration. For the TD registration, the Series 57 exam is the default base exam. (“S57TO” is shorthand for the Series 57 top-off version of the exam. FINRA began to administer the Series 57TO in October 2018 after the representative-level exam restructure.)
 
The TD registration category and the Series 57 exam were both introduced Jan. 4, 2016. On that same date, individuals who were holding the Equity Trader (ET) or Proprietary Trader (PT) registrations were converted to hold an approved TD registration. Some of the affected individuals had previously qualified for the PT by passing the Series 7 exam.
 
Since then, FINRA has received inquiries as to whether an individual who qualified for the TD without passing the Series 57 exam is appropriately qualified to hold an approved TD registration. Therefore, to more clearly display that an individual is qualified to hold the TD registration, FINRA added a Series 57TO exam entry with an exam status of “Credit” to certain individuals’ CRD records. Starting on January 2, 2023, individuals had a S57TO credit added to their record if they held the TD registration (or had held it within the most recent two years) but did not have a Series 57 or Series 57TO exam.
 
This entry in the Exam History section of your record represents that you are qualified to hold the TD registration just the same as if you had passed the Series 57TO exam.
 

Series 79TO Credit  

Q: I have been registered as an Investment Banking Representative (IB) since 2010 when the registration was first introduced. I opted in to the IB with the Series 7 exam rather than passing the Series 79 exam. Recently, when I reviewed the Qualifications area of my record in FinPro, I saw that I now have an entry for the Series 79TO exam with an exam status of ”Credit.” What does this mean? 
 
A: Each registration has a default base qualification exam, which is the exam that an individual must pass to become qualified to hold the registration. For the IB, the Series 79 exam is the default base exam. (“S79TO” is shorthand for the Series 79 top-off version of the exam. FINRA began to administer the Series 79TO in October 2018 after the representative-level exam restructure.)
 
When the Series 79 exam and associated IB registration were introduced in 2010, individuals were able to opt in to the IB if they had passed the Series 7 exam, held the GS registration and were engaged in investment banking. This means that some individuals qualified for the IB registration without taking the Series 79 exam.
 
Since then, FINRA has received inquiries as to whether an individual who qualified for the IB without passing the Series 79 exam is appropriately qualified to hold an approved IB registration. Therefore, to more clearly display that an individual is qualified to hold the IB registration, FINRA added a Series 79TO exam with an exam status of “Credit” to certain individuals’ CRD records. Starting on January 2, 2023, individuals had a S79TO credit added to their record if they held the IB registration (or had held it within the most recent two years) but did not have a Series 79 or Series 79TO exam.
 
This entry in the Exam History section of your record represents that you are qualified to hold the IB registration just the same as if you had passed the Series 79TO exam.
 

Visit the AG Qualification Requirements page to learn more about AG qualification, credit and validity rules.

If you have questions regarding exam credits, call the FINRA Support Center at (301) 869-6699.