Australians in dispute with their bank, insurance provider, super fund, or other financial firms have lodged 73,000 complaints with the financial sector’s new ombudsman and have been awarded $185 million in compensation, in the first 12 months of its operation.
The Australian Financial Complaints Authority (AFCA) is celebrating 12 months since it opened its doors as the nation’s one-stop-shop for complaints about financial firms, replacing three former external dispute resolution schemes.
People made 73,272 complaints to AFCA between 1 November 2018 and 31 October 2019. This represents a 40 percent increase in complaints received compared to AFCA’s predecessor schemes, which in the 2017/18 financial year received a combined total of 52,232 complaints.
Of the complaints made, 56,420 have been resolved with the majority resolved in 60 days or less.
Research conducted in July this year showed that just three percent of Australians knew about AFCA. Yet, despite the need to raise awareness, Australians are making nearly 200 complaints a day.
AFCA Chief Executive Officer and Chief Ombudsman David Locke said AFCA was a fair, free and independent service that was fast becoming valued by the public and its members for its approach to dispute resolution.
“Every day we continue to hear from people who are dissatisfied with the way their financial firm has handled their complaint. These matters have not been resolved internally by financial firms and so the individual then brings their complaint to AFCA,” Mr Locke said.
“We take our commitment to fairness and independence very seriously, and where possible we encourage the financial firm and complainant to resolve the matter among themselves. The statistics show that this happened with 70 percent of all claims resolved in the past 12 months.
“Still, the increase in complaint numbers we are witnessing at AFCA indicates that there is still work to be done by firms to improve their practices and restore public faith in financial firms. AFCA will continue to focus on member engagement to help firms to enhance their own internal dispute resolution procedures.”
Mr Locke said he was proud of the significant milestones that AFCA and its people had achieved in its first year of operation.
“Establishing AFCA as a new organisation and handling a 40 percent increase in complaints was never going to be easy and we are still improving the way we operate,” he said.
“I am very proud of the AFCA team and what has been achieved so far. I am fortunate to work with a great team of people who are professional, passionate about fairness and independence, and who care about our customers.
“AFCA has also been in a major growth phase of staff to meet demand and has launched the first leg of a national roadshow to promote its service across the country.
“The Financial Fairness Roadshow has been a great success. So far we’ve been to 26 locations across Tasmania, Victoria, the ACT and regional New South Wales, where we’ve spoken with more than 7,000 people.
“We plan to tour the rest of the country in the first half of 2020.”
Mr Locke said AFCA had also hosted forums for small business, consumer advocates and AFCA members in 10 locations coinciding with the Roadshow’s itinerary.
