RG 271 Is Here – Are You Prepared?

Applicable to all complaints received on or after 5th October 2021, RG 271 represents the most prescriptive, not to mention the most enforceable, complaints and Internal Dispute Resolution (IDR) guidance issued by the Australian Securities and Investments Commission (ASIC).

The October 5th 2021 deadline has loomed large since the new regulations were announced back in 2020 but, as we all know, the last 12-18 months have proved challenging in a number of unexpected ways, meaning that not all organizations have been able to get RG 271-ready in time.

If you’re one of these businesses, now is the time to pinpoint what exactly RG 271 means for your business and what you need to do to comply before you fall foul of the new regulations.

Who Does RG 271 Apply To?

The new guidance goes beyond previous recommendations, adding financial technology businesses and unlicensed product issuers and unlicensed secondary sellers to the list, alongside all Australian financial service (AFS) licensees, Superannuation trustees, Australian credit licensees and credit representatives.

What Does RG 271 Set Out?

RG 271 extends the reach of the existing RG 165, setting out exactly what you must include in Internal Dispute Resolution (IDR) processes. With the overarching aim of driving fair and timely complaint outcomes for consumers and addressing any systemic issues in the industry, RG 271 is designed to boost trust in the financial services sector. It should make your complaint handling performance effective, transparent and accountable.

What Has Changed?

Under RG 271, you can’t pick and choose what you do and don’t consider to be complaints. Complaints no longer have to include the word ‘complaint’ so, in theory, dissatisfaction communicated via social media, for example, could be a ‘complaint’.  As of October 5th, you need to record and deal with ALL complaints, as long as the author is both identifiable and contactable.

Additionally, you now have to acknowledge receipt of a complaint within 24 hours or one business day, taking into account any preferred communication method indicated by your complainant, and RG 271 is very specific when it comes to issuing IDR responses based on the type of complaint you’re dealing with. You must now provide an IDR response to a standard complaint within 30 calendar days of receiving the complaint (down from 45 days under RG 165), stretching to 45 days for Superannuation trustee complaints (down from 90 days previously).

You also must ensure the final outcome is communicated to the complainant as well as explaining their right to escalate to AFCA if they are dissatisfied. It’s also no longer your decision as to whether or not the complaint has been resolved and you have to confirm with a complainant before marking a case as resolved.

A New Focus on Reporting and Responsibility

RG 271 sets out exactly what you should be reporting on, including the number of complaints received, the nature of complaints, complaint outcomes, any possible systemic issues that have been identified, and any complaint trends that are evident.

You now need to have clear accountabilities for your complaint handling function in place, including in-depth, board-level visibility of complaints and an IDR system that can identify and resolve systemic issues. Quality assurance processes are another must-have and the guidance even specifies what you should be monitoring, stipulating that compliance audits need to happen at least once a year.

What Should You Be Doing Now?

RG 271 represents the ideal opportunity for you to reassess your IDR processes, with a view to seeing just how much you need to do to get RG 271 compliant. All these new requirements might seem daunting, but you can turn compliance into a real business benefit with the right processes and systems in place. By reviewing your existing processes, you can highlight where efficiencies can be made, tightening up how your business deals with complaints and using them as a source of valuable business information. To help with this, we’ve designed this handy RG 271 Compliance Calculator, a free online tool designed to provide you with a clearer understanding of your level of compliance with the new regulations. For more information on how our Aptean Respond complaints management solution can help you to develop a robust, effective and, crucially, compliant complaint management function for your business, get in touch with our team of complaints experts today.