ob体育 has today released updated requirements for how financial firms deal with consumer and small business complaints 鈥� under their Internal Dispute Resolution (IDR) procedures.
鈥楥omplaints handling is the first step in the dispute resolution framework and plays a critical role for firms to restore consumer trust when things have gone wrong. A financial firm鈥檚 approach to complaints handling is a meaningful measure of how it treats its customers and listens to their voice,鈥� said ob体育 Deputy Chair Karen Chester.
Regulatory Guide 271 Internal dispute resolution (RG 271)听has been released after extensive consultation with consumer and industry representatives. This follows a wide body of work establishing an evidence base for raising IDR standards across the financial sector, including:
- ob体育 Report 603 The consumer journey through the Internal Dispute Resolution process of financial service providers
- IDR on-site visits at NAB, ANZ, CBA, Westpac and AMP during 2019 as part of ob体育鈥檚 enhanced supervision program.
鈥楳ost financial firms, like us, want to see positive complaint management cultures that welcome complaints and focus on fairness, quality and timeliness in how they are handled. Better IDR not only benefits consumers and small business, it arms the boards of financial firms with rich and real time data on the customer experience and whether their needs are being met or not鈥�, Ms Chester said.
ob体育鈥檚 updated standards and requirements will drive fair and timely complaint outcomes for consumers and sharpen industry鈥檚 focus on systemic issues. RG 271:
- introduces reduced timeframes for responding to complaints, including superannuation complaints
- sets out what information firms must include in written IDR responses to allow consumers to decide whether to escalate their complaint
- sets new timeframe requirements for customer advocate reviews of appeals against IDR decisions
- gives guidance about how firms can deal with representatives who are not acting in consumers鈥� best interests.
ob体育 will publish a legislative instrument alongside RG 271 which clarifies the enforceable IDR standards and requirements.
鈥楢t this time of economic uncertainty, consumer access to fair and timely complaints handling is more important than ever.
鈥楳aking it right when consumers have suffered loss is an important way to stimulate ongoing consumer participation and trust in the financial system. New requirements recognising the harm that can be done by some debt management firms will also assist in addressing long-standing concerns about their behaviour which are shared by industry and consumer representatives鈥�, Ms Chester said.
ob体育 has given industry until 5 October 2021, to comply with the new IDR standards and requirements.听
鈥榃hile this extended timeframe reflects the impacts of COVID 19, publishing RG 271 now gives affected firms certainty and enough time to make systems and other changes necessary to meet the updated regulatory guidance鈥�, Ms Chester said.
In the coming months, ob体育 will conduct further consultation on the IDR data reporting regime, which was recommended by the Ramsay Review into dispute resolution and complaints framework and passed into legislation in 2018.听
Separately, ob体育 is following up with each of the firms that were subject to supervisory on-site visits about the changes they are making to improve IDR outcomes.
Background
Most financial firms that deal with retail consumers must have a dispute resolution system that consists of an IDR procedure 鈥� that meets the standards or requirements made or approved by ob体育 鈥� and membership of the Australian Financial Complaints Authority.
Download
- Regulatory Guide 271 Internal dispute resolution
- Report 665 Response to submissions on CP 311 Internal dispute resolution: Update to RG 165
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