What Is AFCA and How Can It Help With a Credit File Dispute in Australia?

Most people who discover a problem with their credit file start by contacting the lender or the credit bureau directly. When that doesn't resolve the issue, many assume they've run out of options. In reality, there's a further step — a free, independent dispute resolution service with real authority to require financial firms to correct information and pay compensation. That service is AFCA.

What is AFCA?

The Australian Financial Complaints Authority (AFCA) is an independent external dispute resolution (EDR) scheme authorised by the Australian government to handle complaints about financial firms — including banks, lenders, credit providers, insurers, and credit reporting bodies. AFCA's service is free to consumers and small businesses, and its decisions are binding on financial firms (up to the relevant monetary limits), meaning a firm that loses an AFCA determination is legally required to comply.

AFCA was established in 2018, bringing together three predecessor schemes — the Financial Ombudsman Service (FOS), the Credit and Investments Ombudsman (CIO), and the Superannuation Complaints Tribunal (SCT) — into a single body. All financial firms that provide regulated financial services in Australia are required to be AFCA members. Edit Credit itself is an AFCA member (membership number 114066).

What types of credit file complaints can AFCA consider?

AFCA can consider complaints about credit reporting where a consumer believes information on their credit file is incorrect or was recorded in breach of the applicable rules. This includes defaults listed without proper notice, repayment history recorded inaccurately, credit enquiries made without authorisation, and complaints about how a financial firm handled a hardship request.

AFCA can also consider complaints where a financial firm has failed to respond adequately to a dispute raised directly with them — including situations where the firm has ignored a complaint, delayed unreasonably, or provided a response that doesn't properly address the issue raised.

How AFCA fits into the dispute process

AFCA is an external dispute resolution body — which means it operates after the internal dispute resolution (IDR) process has been exhausted. Before AFCA will consider a complaint, the financial firm must have had an opportunity to resolve it through their own IDR process. Credit providers and credit reporting bodies are required to respond to IDR complaints within 30 days (with some exceptions for complex matters).

If the firm's IDR response doesn't resolve the issue — or if 30 days have passed without a substantive response — the complaint can be escalated to AFCA. At that point, AFCA assigns a case manager, gathers information from both sides, and works through a process that may include conciliation and, if that doesn't resolve the matter, a formal determination.

What AFCA can order

Where AFCA finds in favour of the complainant, it can require the financial firm to correct or remove credit file information, change how information is being reported, pay compensation for financial loss or non-financial loss (such as stress or inconvenience), and take other corrective action. AFCA's determinations are binding on the financial firm up to the relevant limits — for credit reporting complaints, these limits are generally more than sufficient to cover the type of remedies sought.

How Edit Credit uses AFCA

AFCA is one of the tools Edit Credit uses in the process of investigating and resolving credit file issues. For matters where a credit provider's IDR process has not produced the right outcome — or where the strength of the case warrants escalation — Edit Credit will prepare and lodge the AFCA complaint on the client's behalf, manage the case through the AFCA process, and represent the client's position through conciliation and, where necessary, determination.

Understanding how to frame a complaint for AFCA — what information to include, what grounds to argue, and how to navigate the process — makes a material difference to outcomes. AFCA considers both the factual and procedural merits of a complaint, and a well-constructed case is more likely to reach the right result than a general expression of dissatisfaction.

Can you go to AFCA yourself?

Yes — AFCA's service is directly accessible to consumers and small businesses at no charge. If you have a credit file complaint that hasn't been resolved through the credit provider's internal process, you can lodge a complaint directly at afca.org.au. AFCA provides guidance on how to structure a complaint and what information to include.

For more complex matters — where the grounds for the complaint require a detailed understanding of credit reporting law, where multiple parties are involved, or where previous attempts to resolve the issue haven't worked — professional assistance is likely to produce a stronger complaint and a better chance of a successful outcome.

If you have a credit file issue that hasn't been resolved and you want to understand whether AFCA is the right next step, Edit Credit's free initial assessment can help you work out where you stand. Visit editcredit.com.au/personal to get in touch.