Gold Coast consumers and small business will be spared the expense and inconvenience associated with taking financial complaints to court, with the Coalition Government’s Australian Financial Complaints Authority (AFCA) open for business as of Thursday 1 November 2018.
“This new one-stop shop will deliver free, fast and binding service for all financial complaints, whether they relate to banks, credit providers, insurance companies or superannuation funds,” local MP, Karen Andrews said.
‘Gold Coast consumers and small businesses will benefit from increased access to redress as AFCA will have significantly higher monetary limits and compensation caps than were available under the Financial Ombudsman Service (FOS) and Credit and Investments Ombudsman (CIO).
“The kinds of disputes AFCA may hear include: whether financial advice was appropriate in the circumstances; questions about credit card fees; if an insurer is required to pay out under a policy; and disputes between small businesses and their credit providers.”
OLD FRAMEWORK | NEW FRAMEWORK |
Three bodies: Financial Ombudsman Service (FOS) Credit and Investments Ombudsman (CIO) Superannuation Complaints Tribunal (SCT) |
A one-stop-shop: Australian Financial Complaints Authority (ACFA) |
FOS/CIO hears consumer complaints where the value of the dispute is up to $500,000 | Will hear consumer complaints where the value of the dispute is up to $1 million |
FOS/CIO able to award consumers compensation of $323,500 | Will be able to award consumers compensation of up to $500,000 |
FOS hears small business disputes that relate to a credit facility of up to $2 million | Will be able to hear small business disputes that relate to a credit facility of up to $5 million |
FOS/CIO able to award small businesses compensation of up to $323,500 | Will be able to award small businesses compensation of up to $1 million. |
FOS able to award small businesses including primary producers compensation of up to $323,500 | Will be able to award small business primary producers (including farmers) compensation of up to $2 million |
The Coalition Government committed to provide $1.7 million to support AFCA’s establishment, as part of the 2018-19 Budget.
“The establishment of AFCA is part of the Coalition Government’s plan for stronger economy and ensuring a fair go for all Australians,” Mrs Andrews said.