In the financial year 2025, AFCA received over 4,600 complaints from small businesses, marking a 4% increase from the previous year. Notably, 21% of these complaints were dismissed as they fell outside AFCA's jurisdiction, primarily because the lenders involved were not AFCA members. This situation leaves business owners with limited options for redress if issues arise.

AFCA's lead ombudsman for small business, Suanne Russell, emphasized the importance of dealing with regulated lenders. She noted that if a small business lender is not a registered member of AFCA, the business cannot lodge a complaint with the authority if problems occur, leaving them vulnerable.

To mitigate these risks, small business owners are advised to:

• Verify whether a lender is an AFCA member before engaging in any financial agreements.
• Understand that financial services licensees, credit licensees, credit representatives, and superannuation trustees are required to be AFCA members as part of their licensing requirements.
• Be cautious of lenders who are not obligated to join AFCA, such as certain asset leasing businesses and online or private equity lenders serving only business customers.

By choosing regulated financial partners, SMEs can ensure they have access to external dispute resolution mechanisms, providing an added layer of protection and peace of mind in their financial dealings.