CREDIT CARDS RECEIVE 14 TIMES MORE FINANCIAL COMPLAINTS THAN BUY-NOW-PAY-LATER
Data from a major financial regulator has found that of over 70,000 complaints in FY21, credit cards received 14 times more complaints than Buy-Now-Pay-Later (BNPL) products.
A recent Media Release by the Australian Financial Complaints Authority (AFCA) found that credit cards accounted for 14% of all complaints, followed by home loans (9%) and personal transaction accounts (8%). The media release didn’t include reference to BNPL.
However, AFCA’s response to the Parliamentary Joint Committee on Corporations and Financial Services was published this week finding that in the last financial year, AFCA received just 767 (1%) BNPL complaints, which covered 10 BNPL providers.
The response by AFCA Interestingly noted that among the larger BNPL providers, common complaints were about actions taken by BNPL providers to limit access by consumers, including closing or refusing to open accounts and imposing controls on accounts.
The most common complaint types in relation to BNPL were:
- Service quality (107)
- Unauthorised transactions (85)
- Credit enquiry (76)
The most common complaint types in relation to credit cards on the other hand were:
- Default listing (3,738)
- Financial firm failure to respond to request for assistance (2,678)
- Service quality (2,554)
SmartWayToPay spokesperson David Liston today commented on the AFCA data:
“The difference in nature of these complaints is significant. While BNPL receives complaints for restricting access to credit, credit cards get complaints in relation to over-extended credit.”
“The RBA has released its monthly credit card data.There are over 2 million less credit and charge cards in Australia than there was 2 years ago. The AFCA data proves there should be no surprise people are dumping interest bearing credit products in favour of BNPL.”