There have been 200 times more early release financial hardship payments processed by superannuation funds per week since the government’s scheme opened two weeks ago, according to the Association of Superannuation Funds of Australia (ASFA).
ASFA said it estimated that 855,000 individual payments totalling about $7.1 billion had been made by 30 April, for super members suffering financial hardship as a result of the COVID-19 pandemic.
ASFA’s analysis suggested that:
- The number of early release financial hardship payments processed by funds is running at 200 times the typical weekly average;
- Up to 95% of applications had benefited from straight through processing and triggered only minimal amounts of exception handling. Some funds had experienced slightly higher levels of exception handling;
- As a result, preliminary estimates indicate that close to 98% of applications had been paid within five working days;
- A relatively small number of claims had been rejected by funds due to anomalies or concerns regarding evidence of fraud or potential fraud or because an account had been closed or an invalid bank account number was supplied; and
- ASFA estimated that the average withdrawal was around $8,200. This was less than the maximum amount of $10,000 as a substantial number of applicants had less than $10,000 in their superannuation account (or are withdrawing from more than one superannuation account). Some applicants were also withdrawing only what they need rather than the maximum amount.
ASFA chief executive, Dr Martin Fahy, said funds had worked cooperatively with the government and regulators to change systems to process the unprecedented volume of transactions to ensure the payments had been made quickly and safely.
“The strength of Australia’s world-class compulsory super system has enabled super funds to play this important role in supporting Australians in these unique circumstances and superannuation is committed to playing a key role in rebuilding the economy, by providing much needed capital for the recovery,” he said.