The Royal Bank of Scotland (RBS) has criticised a reverse mortgage report - citing it contains case studies that are out of date.

The Australian Securities and Investments Commission (ASIC) and Paul Clitheroe led Australian Government Financial Literacy Board's guide is designed to assist consumers understand if a reverse mortgage is suitable for them.

Tony D'Aloisio, chair at ASIC, said the regulator's research had found consumers find it difficult to understand what a reverse mortgage is and ASIC is concerned that people are being encouraged to borrow more than they actually need.

However, Martin Lynch, head of reverse mortgages at RBS, said while the information within the guide is correct, he is disappointed with the tone of the case studies used.

He said the case studies reflect the reverse mortgage industry of the past when products were bought directly without financial or legal advice.

"It's based on old products; historical research and I don't think it reflected the way the world is now. We've been encouraging the guide to come out but the fact is the case studies were so bleak versus the response we get from customers is so positive," said Lynch.

Lynch pointed the bank's research of more than 400 retirees which he said found people that take out a reverse mortgage are using it sensibly. The key reasons for taking out a reverse mortgage is for home repairs, extra income or buy a car, the survey found.

In addition, almost every person surveyed said they would recommend a reverse mortgage to friends and family.

"Clitheroe's and ASIC's comments that people are being encouraged to borrow more than they need is completely out of date. In the old days people only had the option of a lump sum whereas now a lot of our customers take out a line of credit and it's just sitting there if they need it," he said.

"The assertion that people don't know what they're buying again reflects the old days where people bought direct. We're one of the biggest players in this space and all our clients have to get financial advice and independent legal advice."