In a submission to the interim Review of the financial system external dispute resolution and complaints framework report by Professor Ian Ramsey, the ABA said a 'one-stop-shop' would simplify the complaints and compensation process.
Professor Ramsey's report has recommended the Financial Ombudsman Services and the Credit and Investments Ombudsman be replaced with a single ombudsman service.
ABA executive director for retail policy Diane Tate said a "single path" for complaints with an "overarching gatekeeper" would strengthen the current system.
"The ABA also supports expanding access so consumers can bring disputes up to the value of $1 million, and compensation can be awarded also up to $1 million," Ms Tate said.
"As part of our Better Banking program, banks are improving their own complaints handling processes and appointing new dedicated customer advocates. Six banks have already appointed their customer advocate, with the other banks committed to have theirs in place by April.
"To help build confidence in the financial advice industry, and as part of the professionalisation of financial advice, the ABA supports the setup of a new compensation scheme.
"This would be a mandatory, prospective compensation scheme that covers consumers who have received poor financial advice, but haven't been paid compensation awarded by an ASIC-approved external dispute resolution scheme because the financial adviser is no longer in business. This scheme would be available when no other redress avenues are possible."
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