The Australian Financial Complaints Authority has updated its rules to accommodate COVID-19 relief measures, effectively putting loans made under the government’s Coronavirus SME Guarantee Scheme outside its remit.

Loans subject to deferral arrangements have also been removed from its jurisdiction.

Under the Coronavirus SME Guarantee Scheme (SMEG), the government is providing a guarantee of 50 per cent to SME lenders to support new short-term unsecured loans to SMEs. The scheme will guarantee up to $40 billion of new lending.

The scheme includes a temporary exemption from responsible lending obligations for lenders providing credit to existing small business customers.

The amended AFCA Complaint Resolution Scheme Rules say: “When considering the complaint, AFCA and the AFCA decision maker must not take into account any decision made by the lender which relates to a decision to provide the SMEG loan to the borrower or the amount of the SMEG loan.”

AFCA must consider such a complaint on the basis that the lender was permitted to disregard the impact of COVID-19 when determining the financial situation of the borrower.

AFCA must also give weight to the fact that the purpose of SMEG is to encourage the quick and efficient provision of loans to borrowers.

The changes also require AFCA to exclude complaints about repayment deferrals provided to small business borrowers for existing loans, where the deferral is provided between 25 April 2020 and 24 April 2021.

The rules say: “AFCA must exclude any complaint, or part of a complaint, in relation to the decision to provide a repayment deferral and any consequential change to the amounts payable or guaranteed under the deferral loan.”