The move has been welcomed by the Financial Services Council (FSC), who said that it reflected the federal government's focus on finalising the remaining pieces of the Royal Commission into the Banking, Superannuation and Financial Services industry.

“The Assistant Treasurer has got the balance right with the CSLR scheme, which will provide consumers with a safety net of up to $150,000 for eligible unpaid Australian Financial Complaints Authority determinations,” FSC CEO Blake Briggs said in a statement.

“The CSLR will establish an industry funded scheme to protect consumers who have incurred losses while not excessively burdening customers and well-run organisations that have done nothing wrong with the costs of the scheme.”

Furthermore, Mr Briggs said that the FAR will bring additional accountability measures for senior executives in prudentially regulated sectors, including superannuation, life insurance and banking and provides for penalties on those institutions.

“The aim is for the CSLR to be genuinely last resort through effective enforcement of existing laws to minimise the potential cost of the scheme to consumers and industry,” he said.