Consumers lodged a record 96,987 complaints with the Australian Financial Complaints Authority (AFCA) in the past 12 months, an unprecedented rise of 34 per cent on the previous financial year.

The data below is based on a preliminary snapshot as at 30 June 2023. Further analysis and validation will occur in the coming months.

You can read the media release here.

Key statistics

Our preliminary data “snapshot”, as of June 30, shows a 34 per cent rise in complaints to an annual record 96,987, or an average of 266 a day. This included a monthly record of 11,249 complaints received in March 2023 (or 363 complaints a day at that time). 

Total compensation and refunds secured by consumers rose 22 per cent to $253.81 million.

Complaints were resolved in an average of 69 days, down from 72 days the previous year. This reflects initiatives by AFCA to address the rising number of complaints, and improved ‘early resolution’ by some firms, such as those in banking and finance.

The data snapshot shows that 71 per cent of complaints were resolved by agreement between the firm and consumer, up from 67 per cent the previous year. Nearly 60 per cent were resolved at the first stage of our process, when we refer a complaint back to a firm for consideration. This “early resolution” rate was up from 51 per cent the previous year.

These improvements are pleasing. When a complaint comes to AFCA, the first stage in our process is to register it and refer it back to the financial firm for consideration. AFCA welcomes early resolution at this stage, as long as the outcome is fair for both parties, because it’s efficient and cost-effective for firms and it takes away anxiety and uncertainty for complainants.

If early resolution at this first stage is not possible, we continue to work with the parties to try to help them reach agreement during processes such as mediation. If agreement can’t be reached we can make a decision that, if accepted by the complainant, is binding on the firm. In 2022-23, just 5 per cent of disputes needed to progress to a formal decision (known as a determination), compared with 7 per cent the previous year.

Top 5 products complained about

	FY23	Change	FY22
Personal Transaction Accounts	13,781	86%	7,416
Credit Cards	10,555	15%	9,153
Home Building	9,592	57%	6,120
Vehicle insurance (comprehensive)	8,296	43%	5,791
Home Loans	7,096	10%	6,439

Personal transaction accounts overtook credit cards as the most complained about product in 2022-23. It is the first time credit cards have not topped the list since AFCA’s inception nearly five years ago. This is partly due to scam-related complaints (see scams data below).

Top 5 issues complained about

	FY23	Change	FY22
Delay in claim handling	10,996	76%	6,259
Unauthorised transactions	10,840	69%	6,398
Service quality	8,374	-4%	8,744
Insurance claim amount	6,266	42%	4,419
Denial of insurance claim due to exclusion/ condition	4,851	51%	3,222

The top issue in complaints to AFCA in 2022-23 was delay in insurance claim handling. This was a significant issue in general insurance (see more below), and within the superannuation segment, where there was a 136 per cent rise in complaints about claim delays, including the payment of death benefits.

Unauthorised transactions was the second most complained about issue. This is a broad category that includes, among other things, credit card transactions that aren’t authorised by the cardholder, the sale of an investment without authority, or ATM withdrawals made with a stolen card. In complaints about scams, we often see that the dispute between the consumer and firm is about whether or not a transaction was authorised by the consumer.

Complaints by segment

	FY23	Change	FY22
Banking and Finance	53,638	27%	42,392
General Insurance	27,924	50%	18,563
Life Insurance	1,898	-24%	2,482
Investments and Advice*	4,840	51%	3,207
Superannuation	6,957	32%	5,286

*The Investments and Advice total includes a significant number of complaints in relation to just two firms: 1,726 for Dixon Advisory (see our Current Matter) and 656 for Best Leader Markets (foreign exchange-related complaints). Without these, the total would have been 2,458, which would have represented a decrease in complaints of 23 per cent.

Themes

Financial difficulty

The impact of financial stress from rising interest rates and costs of living became increasingly evident in complaints to AFCA in the final three months of 2022-23. 

Complaints involving financial difficulty rose 9 per cent over the year to 4,849 but were up 31 per cent when the June quarter was compared with the same three-month period a year earlier (quarter on quarter).

Home loan complaints were up 10 per cent over the year, but 19 per cent quarter on quarter. Credit card complaints were up an annual 15 per cent, but 34 per cent quarter on quarter. Buy now pay later (BNPL) complaints rose across the year, being up 57 per cent annually and 56 per cent in the June quarter compared to the previous June quarter.

Scams

AFCA received 6,048 scam-related complaints in 2022-23, a rise of 46 per cent on the previous year. That’s an average of 504 complaints a month, up from 344. 

AFCA welcomes initiatives by individual banks to combat this serious and sophisticated financial crime but would welcome a more consistent approach across the sector. 

We welcome the government proposal for codes of practice to address scams as we believe enforceable standards would lift the bar for scam prevention and remediation. 

Such codes of practice would also aid the work AFCA does as an ombudsman service. Codes of practice are among the elements AFCA has regard to when considering complaints.

General insurance delays

The top issue in complaints to AFCA in 2022-23 was delay in insurance claim handling overall, with a 76 per cent rise to 10,996 complaints of this type.

In general insurance specifically (excluding life insurance), complaints about claim delays were up 66 per cent to 7,953.

The bulk of complaints about general insurance claim delays were not about natural disasters. Of the 7,953 complaints about delay, 912 were associated with “significant” events, or “catastrophes”. (Within that group, 622 were specifically about claim delays in relation to the South-East Queensland/northern NSW floods of early 2022.)

AFCA is working with insurers to try to ensure fewer people have to take the extra step of bringing a complaint to AFCA.

Complaints received state by state

	FY23	Change	FY22
ACT	1,904	63%	1,166
NSW	29,804	28%	23,220
NT	584	23%	476
Queensland	17,785	26%	14,094
South Australia	5,481	26%	4,364
Tasmania	1,187	29%	920
Victoria	26,232	25%	20,988
Western Australia	7,546	21%	6,216