Compensation Scheme of Last Resort

The Compensation Scheme of Last Resort (CSLR) is an independent, not-for-profit company which will commence operations on 2 April 2024. Visit the CSLR website for more information about the scheme.

The CSLR will provide compensation of up to $150,000 to consumers who have an unpaid determination from the Australian Financial Complaints Authority relating to personal financial advice, credit intermediation, securities dealing or credit provision, and other eligibility criteria are met. A determination may be unpaid because the financial institution subject to the determination has become insolvent.

From 1 July 2024, the CSLR will be funded by levies imposed on parts of the financial services industry. Under the CSLR legislative framework:

CSLR is responsible for determining the total costs to the scheme for the leviable period; and
ASIC is responsible for issuing levy notices and collecting levy payments.

The information below is for industry participants required to pay the annual levy.

About the annual levy

Who is subject to the annual levy?

On an ongoing basis the CSLR will be funded by an annual levy payable by:

licensees that provide personal advice to retail clients on relevant financial products
credit providers
credit intermediaries
securities dealers

How are levies calculated?

The CSLR has determined the total estimated costs in each sub-sector for 2024-25. Visit the CSLR website for information about the estimate.

ASIC uses the estimate determined by the CSLR to calculate the leviable amount per entity. The amount of levy imposed on a person in a sub-sector is the sum of:

the minimum levy component ($100), and
the graduated levy component.

ASIC will use the 2022-23 Industry Funding business activity metrics to calculate the leviable amount for the 2024-25 CSLR levy period. This instrument relates to ASIC’s metric collection:

ASIC (Financial Services Compensation Scheme of Last Resort Levy—Return Deadline) Notice 2023/587 (PDF 216 KB)

The method for calculating an individual entity’s levy is set out in the Financial Services Compensation Scheme of Last Resort Levy Regulations 2023.

Summary of levies

The summary of levies is to assist entities in calculating the leviable amounts.

Sub-sector	Period Estimates¹	Number of entities	Levy metric and description	Actual levy amounts²
Credit providers	$1.498 million	1,019	Credit provided in the financial year (contracts other than small and medium amount credit contracts)	Minimum levy of $100 plus $1.95 per $1 million of credit provided above $100 million (for other than small and medium amount credit contracts)
Credit intermediaries	$1.800 million	4,214	Credit representatives and number of days authorised	Minimum levy of $100 plus $33.85 per credit representative
Securities dealers	$2.288 million	1,095	Annual transaction turnover value	Minimum levy of $100 plus $14.92 per $1 million of annual transaction turnover
Licensees that provide personal advice to retail clients on relevant financial products	$18.562 million	2,766	Adjusted number of advisers on the financial advisers register and number of days authorised	Minimum levy of $100 plus $1,186 per adviser

1 Amounts are rounded to the nearest $1000.

2 Levy amounts have been rounded.

Invoicing for the annual levy

ASIC anticipates that we will begin to issue notices for the 2024-25 annual levy, early August 2024. These will be available for account holders via the ASIC regulatory portal. For those not yet registered on the portal, the notice will be sent via mail to the address registered with ASIC. Levies will be due for payment 30 business days after issue.