Access to free dispute resolution.

The Turnbull Government’s commitment to overhaul the external dispute resolution framework for financial disputes in Australia is taking shape.

The new financial dispute resolution scheme, the Australian Financial Complaints Authority (AFCA), will provide consumers and small businesses with access to free, fast and binding dispute resolution.

The Minister for Revenue and Financial Services, Kelly O’Dwyer, said AFCA will have expertise to deal with all disputes across the entire financial services industry, including superannuation and small business lending disputes.

“For the first time consumers will be able to go to one place to resolve any kind of financial complaint, and the new AFCA scheme will operate under significantly higher monetary limits and compensation caps to boot,” the minister said.

AFCA will commence accepting complaints from November 1, 2018, to allow the AFCA sufficient time to put in place the necessary infrastructure and staff to be ready to receive complaints.

Consumers will be able to lodge complaints with existing industry ombudsman schemes, the Financial Ombudsman Service (FOS) and the Credit and Investments Ombudsman (CIO) and the Superannuation Complaints Tribunal (SCT) until AFCA commences.

The SCT will continue to operate beyond AFCA’s commencement to resolve the existing complaints it has on hand. Complaints lodged with the SCT will not be transferred to AFCA. The Treasury has put together a fact sheet to assist people who have already lodged a complaint with SCT, or who are thinking about making a complaint in the future. Financial firms will be required to become members of AFCA by September 21, 2018.

All Australian Financial Services Licensees, Australian Credit Licensees, superannuation trustees and other financial firms required to become members of AFCA by law will need to do so by no later than September 21, 2018. Over the coming months AFCA will outline the process for applying for membership.

One of the first priorities of the AFCA Board will be to commence public consultation on the AFCA terms of reference (known as the AFCA Rules) and the scheme’s interim funding model.

The AFCA Board will continue to engage with the existing dispute resolution bodies to bring about a smooth transition to AFCA for consumers and financial firms. Further information on the transition will become available on the AFCA website, which will be released shortly.