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The Australian Financial Complaints Authority (AFCA) has announced on their website that a new small business Lead Ombudsman will be appointed to resolve financial disputes that small businesses have with their financial service providers (FSPs).
Under AFCA the small business is now defined as an organisation with less than 100 employees and can consider complaints from small businesses with their FSP up to the value of $5 million. AFCA also announced an increase in the available compensation to small businesses from $323,500 to $1 million.
In a statement to the media AFCA Chief Ombudsman and CEO David Locke, said, "With the arrival of AFCA, and the increase in monetary limits, many small business complaints will now be covered by an external dispute resolution scheme for the very first time. This will be a big help and provides small businesses with a fair, free and independent way of resolving their disputes."
The Australian Small Business and Family Enterprises Ombudsman (ASBFEO) has applauded the decision with Kate Carnell saying, "We welcome the announcement of a dedicated small business lead ombudsman,” Ms Carnell said. “We envisage a small business expert will be appointed, which will significantly improve small businesses’ access to justice and save them time and money."
The announcement comes on top of AFCA releasing information that in their 1st week of operation that they received 2,500 calls with a subsequent 1,500 complaints being made.