ASIC has initiated public consultation on new standards in relation to the handling of consumer and small business complaints. The consultation covers the proposed updates to ASIC’s IDR standards (currently set out in Regulatory Guide 165 Licensing: Internal and external dispute resolution) and a proposed framework for mandatory IDR data reporting by financial firms to ASIC.
Under the proposed changes to the IDR standards, financial service licensees will be required to:
- record all complaints, including those resolved at the first point of contact;
- record unique identifiers and prescribed complaints data for each complaint that is received;
- provide IDR data to ASIC in a manner that is compliant with ASIC’s mandated requirements;
- provide IDR responses to complainants that satisfy minimum content requirements;
- provide IDR responses to complainants within reduced maximum IDR timeframes;
- setting clear accountabilities for complaints handling addressing thresholds and processes for identifying systemic issues arising from complaints.
Importantly, ASIC propose to expand the concept of ‘complaint’ to include expressions of dissatisfaction made ‘to or about an organization’ where a response is ‘explicitly or implicitly expected or legally required’. The expanded definition aims to capture complaints made on a firm’s own social media platform made by identifiable consumers.
The proposed standards are informed by research findings which suggested customer fatigue and IDR shortcomings. It aims to address and enhance IDR efficiency and fairness.
ASIC’s proposed mandatory IDR data reporting framework would require financial firms to report to ASIC at six monthly intervals and lodge IDR data reports through the ASIC regulatory portal. The intention is that mandatory data reporting requirements will increase transparency on the manner in which financial firms handle complaints and non-financial risks. ASIC have proposed a transitional period for the mandatory data reporting requirements, given the onerous nature of the reporting requirements.
Public input on the consultation documents will continue until 9 August 2019. ASIC aims to release new IDR standards in a new Regulatory Guide 165 (‘Licensing: Internal and external dispute resolution’) by the end of 2019.
Further information can be found here.