AFCA: The acronym all Australian consumers should know

A new independent body has been established to help consumers seek justice if they believe they have been treated unfairly by banks, insurers and other financial services providers.

The Australian Financial Complaints Authority (AFCA), a new “one-stop shop” for Australian consumers to resolve problems with various providers, launched on 1 November.

The Government first proposed AFCA on 9 May last year. It brings together three previous dispute-resolution bodies: the Financial Ombudsman Service, the Credit and Investments Ombudsman, and the Superannuation Complaints Tribunal.

The body will provide consumers with access to “free, fast, and binding” dispute resolution for financial services complaints, according to federal Assistant Treasurer Stuart Robert.

“Australian consumers and small businesses will be spared the expense and inconvenience associated with taking financial complaints to court, with the Coalition government’s Australian Financial Complaints Authority opening for business,” he said.

The process
Consumers who have a complaint with their financial institution, be that a bank, a super fund, or an insurance company, should first take the complaint to that business and try to resolve it directly. However, if the outcome of that isn’t satisfactory, they can reach out to AFCA.

Once a complaint is filed with AFCA, which can be done using a form on the organisation’s website, an AFCA representative will contact the relevant financial service provider and try to arrange a settlement.

“It may be that an individual has had no joy, but when it comes to us, the financial firm might come to the table and sort [the dispute] out,” Mr Locke said. If a settlement cannot be reached, the case passes on to one of AFCA’s case analysts, who are tasked with finding a solution that’s “fair in all the circumstances”.

The consumer who made the complaint then has the option to either accept AFCA’s proposed settlement (which is then binding on the financial services firm), or walk away and try their luck in court.

More details about AFCA are available on its website – www.afca.org.au.

The unabridged version of this article was first published in The New Daily on 31 October 2018.