Australian Financial Complaints Hit Record High

Sydney — Australians are increasingly taking financial disputes to the country's external complaints authority, with rejected superannuation claims, insurance disagreements and scam-related losses contributing to a record workload in the 2025–26 financial year.

The Australian Financial Complaints Authority (AFCA) recorded almost 120,000 complaints from consumers and small businesses, the highest annual total in its history.

The figures raise questions about how effectively financial institutions are addressing customer grievances before they require independent intervention.

Superannuation emerged as a particularly significant pressure point. Complaints in the sector climbed 42% to 8,755, while disputes involving funds refusing to pay claims increased by 80%.

The figures carry particular significance for people approaching or entering retirement, for whom superannuation savings can represent decades of contributions and a major source of future income.

AFCA Chief Ombudsman, David Locke, said financial institutions needed to respond more effectively when customers raised concerns, rather than allowing disputes to progress to external review.

Banking and finance accounted for 66,971 complaints, making it the largest category.

Among the issues reported were 6,580 complaints about scams and 6,038 involving unauthorised transactions, underscoring the continuing difficulties consumers face when money is lost or transactions are disputed.

A new avenue for some victims is planned for next year.

The Australian Scams Ombudsman, which will operate under AFCA, is due to begin accepting complaints involving banks, telecommunications providers and digital platforms on March 31, 2027.

It is intended to assist consumers who cannot resolve their complaints directly with the organisations involved.

Insurance disputes also remained a major source of dissatisfaction. General insurance complaints reached 36,022, extending a five-year upward trend, with motor vehicle insurance accounting for 14,430 cases.

Locke said climate-related events and supply chain disruptions had affected the sector but stressed that insurers still needed to explain claim delays and keep policyholders informed.

Funeral insurance was another area of concern, with complaints pointing to difficulties cancelling policies and confusion over premiums.

Although these cases represented a smaller share of AFCA's workload, the authority said the direction of the trend warranted attention.

Investment disputes, meanwhile, were heavily influenced by the collapse of the Shield and First Guardian Master Funds.

Investors affected by the failures have faced prolonged uncertainty as their complaints move through the dispute-resolution process.

Financial hardship complaints rose 17% to 5,566. A leading problem was financial firms failing to respond to requests for assistance, even as customers sought help managing financial pressure.

Locke said early intervention and timely hardship support were essential, warning that delayed decisions could worsen an already difficult situation for customers.

AFCA's figures also highlight the role of internal complaint systems within financial institutions.

Resolving disputes directly with customers can spare them the time and uncertainty of an external process, while allowing AFCA to concentrate on cases requiring independent assessment.

However, the authority reported that complaints were already rising in the opening quarter of the 2026–27 financial year. If that pattern continues, the annual total could climb further.

AFCA offers free, independent dispute resolution for consumers and small businesses dealing with financial firms.

Its remit covers banking, credit, insurance, investments, financial advice and superannuation, and its determinations can be binding on financial firms when disputes cannot otherwise be resolved.

The annual figures provide a measure of the problems reaching the external complaints system, although they do not establish that every complaint is justified or that all financial firms are experiencing the same difficulties.