It has never been more important to check your credit card statement for errors, according to figures from the Australian Financial Complaints Authority (AFCA).
Data provided by the AFCA on all the financial complaints they received last financial year shows that unauthorised transactions on credit cards are surging.
Credit cards were the most complained about financial product for 2020-21, accounting for around 14 per cent of all complaints, and the most common issues were default listings and unauthorised transactions (the latter accounting for 11 per cent of all credit card complaints).
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Complaints related to personal transaction accounts rose 48 per cent, with unauthorised transactions accounting for 29 per cent of those complaints.
Also, complaints about electronic banking increased 76 per cent, with unauthorised transactions accounting for 28 per cent of those complaints and mistaken internet payments accounting for a further 19 per cent.
AFCA’s chief ombudsman, David Locke, says the surge in complaints about unauthorised transactions could be related to the pandemic.
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“There’s no single reason for these increases but people transacting online more during COVID will have contributed,” Mr Locke said.
“Scams, which have accelerated during the pandemic, are also leading to growing complaints about transactions.”
If you check your bank statement and there is a transaction that you don’t recognise, you are advised to contact your bank as soon as possible.
The sooner you contact your bank, the more likely you are to get your money back – and if the transaction is unauthorised, the sooner the bank can stop any further transactions.
According to the government’s MoneySmart website, when you check your accounts, you should look for payments or withdrawals you don’t recognise, such as:
- a payment to a person or company you don’t know
- a cash withdrawal from a place you’ve never been
- a transaction on a date when you didn’t use your account
- a payment made twice.
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Overall, in financial year 2020-21, AFCA received more than 70,000 complaints, with those lodging problems securing more than $240 million in compensation and refunds, as well as outcomes such as fee waivers, debt forgiveness and apologies.
AFCA’s investigations also resulted in remediation payments to consumers totalling nearly $32 million in the past financial year.
Mr Locke said one of the pleasing aspects about the financial complaints received in the past 12 months was a reduction in complaints regarding financial difficulty, which dominated complaints made in 2019-20.
“Complaints involving financial difficulty were down nearly 40 per cent from the numbers we saw the previous year,” Mr Locke said. “That’s a great outcome and reflects the positive response from government and industry to the impact of COVID.
“However, it’s too early to say we’re out of the woods yet. It may be some months before we know the full impact of the end of government emergency support and assistance from financial firms such as deferred loan repayments. And, of course, we are still living with COVID-19.”
Overall, complaints were down 12 per cent on 2019-20, a year that included the initial months of the COVID-19 pandemic and a spike in complaints in areas such as travel insurance.
In 2020-21, there were 8303 COVID-related complaints, up from 5013 in just four months at the end of 2019-20 after the pandemic was officially declared. That translates to an average of 692 a month in 2020-21, down sharply from an average of 1253 a month from March through June 2020.
The AFCA data for 2020-21 also shows travel insurance complaints down 22 per cent, as Australians stayed at home, and superannuation complaints down 31 per cent, after a jump the prior year when the government allowed the early release of super at the start of the pandemic.
Do you check all of your bank statements for errors or unusual transactions? Will you start checking them now that there seems to be a surge in these types of problems? Why not share your thoughts in the comments section below?
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