From the 2024-25 financial year, credit providers, credit intermediaries, financial advisers and securities dealers will commence paying the annual Compensation Scheme of Last Resort Levy.
Established by legislation in 2023, the Compensation Scheme of Last Resort will begin accepting consumer claims from 2 April 2024.
To address the backlog of accumulated complaints (with a quantum of $240,857,800.07), a one-off levy will be paid by the ten-largest banking and general/life insurance groups with this levy to be calculated in April 2024, invoices issued in May 2024 and to be paid in two instalments in June and July 2024.
Importantly for the broking industry (within the credit intermediary subsector), the first levy for the 2024-2025 financial year has been announced. The levy will be:
- $100 per licensee
- $33.85 per credit representative.
ASIC is responsible for calculating the levy in accordance with prescribed regulations, and will issue invoices in August 2024 with payments due within 30 days of issue.
“Mortgage and finance brokers account for less than 1% of complaints and in our submissions on the Scheme we were firm that the levies our members pay should not cross-subsidise other sectors,” said Naveen Ahluwalia, MFAA Executive, Policy & Legal
“We will monitor CSLR levies to ensure they remain reasonable and proportionate.”
For further information you can read our submission on this topic or head to the Scheme’s website at www.cslr.org.au.
