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ARTICLE · 22 DECEMBER 2017

A new era for financial services dispute resolution - AFCA

Corrs Chambers Westgarth
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Many of the operational details of the AFCA scheme will be set out in guidelines and other informational AFCA material.

AustraliaFinance and Banking
Michael Chaaya
Michael Chaaya
Magan Goh
Magan Goh
Joanne Dwyer
Joanne Dwyer
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WHAT WE CAN EXPECT FROM AFCA

Treasury's recently concluded consultation paper (Paper) has now provided further insight into how the AFCA scheme may operate. The Paper confirms that much of the operational details will be set out in guidelines and other informational material to be issued and updated by AFCA itself, foregoing the need for ASIC approval unless there is a material amendment.1

Here are some of the key features of AFCA:

  • Organisational requirements – All financial and credit service providers will be forced to become a member of the AFCA scheme. A 'user pays' model is under consideration as it may incentivise members to avoid or otherwise settle disputes.
  • Operator requirements – AFCA will be subject to regular independent reviews and will be operated by a not-for-profit company limited by guarantee.

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