Financial complaints to the newly operational Australian Financial Complaints Authority (AFCA) have soared compared to complaints to the bodies it replaces.
AFCA started accepting complaints on 1 November, taking over from the Superannuation Complaints Tribunal (SCT), Financial Ombudsman Service (FOS) and the Credit and Investments Ombudsman (CIO). Since then it has seen an increase of 47% in complaints received, compared to the three earlier bodies.
In its first month of operation AFCA has received over 13,000 phone enquiries and received 6,522 complaints from consumers and small business – averaging 310 complaints per business day.
AFCA CEO and Chief Ombudsman said the number of calls and complains was on par with what was expected.
“We want to make sure that members of the public know where to go for help when they have a financial complaint they can’t resolve directly with their financial firm,” he said.
“AFCA provides quick and easy access to fair resolutions. This is part of our role in rebuilding trust in the financial services sector. In fact, while we have only been operating for a month, 15% of the complaints we received in the month of November have already been finalised.”
“Our streamlined processes and systems have dealt well with the level of calls and complaints received. 80% of complaints have been lodged online, meaning consumers and small businesses have been able to access our service whenever and wherever they need it.”
AFCA says that while there have been a “high number” of complaints, they relate to less than 6% of AFCA’s licensee members.
45% of the complaints received so far have been about credit, with 21% about general insurance, 10% deposit taking and 8% about superannuation.
84 “definite system issues” are currently being investigated by AFCA, with 4 “potential serious contraventions and other breaches”.
“Systemic issues are identified in a complaint or several complaints, and have an effect on people beyond the parties to a complaint. Because of this, we take our responsibility to identify and investigate systemic issues very seriously. Financial firms should be in no doubt that we will be referring and reporting these to the appropriate regulator,” said Mr Locke.