One-stop shop for South West financial complaints

Member for Forrest Nola Marino said South West people and small businesses will benefit from the passage of legislation to establish the Australian Financial Complaints Authority (AFCA).

This means South West people and small businesses will have access to free, fast and binding dispute resolution as a result of the establishment of AFCA.

Mrs Marino said AFCA will provide a one-stop shop to ensure consumers get a fair deal in resolving disputes with their banks, insurers, super funds and small amount credit providers, without the expense, inconvenience, and trauma associated with going to court.

The Turnbull Government is also expanding access to the dispute resolution service by widening the range of disputes that AFCA will be able to hear, in line with recommendations from the AFCA Transition Team, chaired by Dr Malcolm Edey, former Assistant Governor of the Reserve Bank of Australia (RBA).

These include:
– The definition of a small business will be relaxed, so that any business with fewer than 100 staff can access AFCA;
– Small business primary production producers – defined in accordance with the Income Tax Assessment Act 1997 – will be able to bring a dispute to AFCA and be able to access compensation of up to $2 million for credit facility disputes. The requirement that the dispute must relate to a credit facility of $5 million or less will remain;
– The cap on income stream product disputes will be increased from $8,300 to $13,400 per month;
– The cap on uninsured third party motor vehicle claims will increase from $5,000 to $15,000; and
– The separate compensation cap for general insurance broker disputes will be removed – instead these disputes will subject to the $500,000 compensation cap that will apply to most consumer disputes.

‘Our small businesses including farmers and other primary producers will benefit from the new Afca Scheme and the significant increase in the comp available of up to $2m,” Mrs Marino said.

AFCA will start receiving disputes from no later than 1 November 2018 and will replace the existing Financial Ombudsman Service, Credit and Investments Ombudsman and the Superannuation Complaints Tribunal.