The Australian Financial Complaints Authority (Afca) is established through a bill that passed into law on 14 February. It follows the culmination of more than 20 months of public consultation and inquiry.
Asic deputy chair Peter Kell said: “Fair, timely and effective dispute resolution is a cornerstone of the financial services consumer protection framework.
“The combination of firms’ internal dispute resolution procedures and access to a free independent external scheme currently provides redress for many tens of thousands of Australians each year,” Kell said.
Strengthening dispute resolution requirements, Kell said, will help deliver higher standards and better outcomes in the financial services market.
He called the establishment of a single scheme for all financial services and superannuation complaints a “very positive development”.
Higher monetary limits and compensation caps will give more consumers and small businesses access to a free and independent forum to resolve their complaints.
Asic said it will work with the Australian Government and scheme stakeholders to transition disputes from the Financial Ombudsman Service (FOS) and the Credit Investments Ombudsman (CIO) to the new authority.
“In the interim, Asic will retain direct oversight of the two Asic-approved schemes – FOS and CIO – which will continue to provide high levels of service to consumers and firms,” an Asic spokesperson said.