In total, AFCA has received over 3,180 COVID-19-related financial complaints, a majority of which, or 1,430, pertained to banking and finance, with 680 of these arising from financial difficulty.
The total COVID-19-related complaints also included 1,070 general insurance complaints and 610 superannuation complaints.
Speaking to members at an online forum on Tuesday, chief operating officer Justin Untersteiner revealed that a majority of these complaints have been about loan break costs, disputed transactions, requests to extend payment terms, denial of travel insurance claims as well as delays in early release of superannuation.
He urged financial firms to provide early, proactive communication with consumers.
“Many of these complaints result from poor communication, where a consumer has trouble contacting their firm, does not understand their policy or is confused about the information they receive,” Mr Untersteiner said.
“To support consumers, we encourage financial firms to ensure their contact details and resources are visible and accessible and allow for genuine engagement with customers to resolve issues early on.”
Mr Untersteiner said AFCA anticipates receiving more financial difficulty complaints in the next six to 18 months.
“We expect to see more complaints from vulnerable consumers or others who struggle to repay mortgages or other debts as government and sector support initiatives come to an end,” he said. “This won’t just be an issue for banking and finance; many will turn to their insurance policies to look for help, and in some cases, they will not be covered which will lead to disputes.”
AFCA also predicts an increase in responsible lending complaints, disputes relating to scams, and a rise in business interruption insurance complaints, as well as additional complaints relating to early access to superannuation from June to September.
Discussing AFCA’s unique view of the challenges facing the industry, Mr Untersteiner underlined that this data can be used to help financial firms see current trends so that they can address problems and reduce complaints.
He said: “We encourage financial firms to minimise COVID-19-related disputes by communicating with consumers early, speaking in plain English, proactively setting customer expectations around delays, reviewing internal dispute resolution processes and regularly engaging with AFCA.”