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Digital services disputes on the rise for small businesses

When Paul, the proprietor of Zenbar Massage, was setting up his remedial massage business in Dickson last year, one of his early priorities was to promote his service.

After researching online, he engaged a British-based marketing company which, for a commission, sold appointment vouchers.

The promotion appeared to work and, in addition to his other clientele, Paul (who did not want his last name published) was seeing around one customer a day armed with a voucher for his service.

The problem came after Adrian Rollins about 50 days when the marketing company was due to deposit payments for the vouchers in Paul’s bank account, minus tax and their commission.

The payments never appeared and Paul’s calls and emails to the British firm went unanswered.


After six months of frustration, he took his complaint to the Small Business and Family Enterprise Ombudsman.

The Ombudsman managed to establish contact with the marketing service and within two months negotiated the payment of all the funds owed to Paul.

Having the ombudsman involved made all the difference, he told The Canberra Times. “It is hard as a small business to constantly try to phone and email people when they are in a different time zone,” he said.

“I was just one small business, and they deal with a lot of small businesses. Having someone who sounds official, like they come from the government, really helped.” Paul’s complaint is among thousands about digital services that have been made by small businesses to the ombudsman.

According to Ombudsman Bruce Billson, more than one-in-four disputes handled by his organisation now involve digital services and platform providers, which was “double the proportion we received just two years ago”.

Mr Billson said the increase in problems was worrying, particularly because so many businesses relied heavily on their digital presence to connect with clients and operate.

The Ombudsman said many cases involved trying to restore an account that had been shut down by a platform after getting hacked.

“Some people have built their entire businesses on social media and digital platforms and having someone else access and control their account is devastating for their business and reputation,” he said.

“They watch the financial and emotional damage occur in real time with no ability to stop it.” Mr Billson said one of the “absurdities” of the situation for businesses locked of their own account is that platforms require them to access the account to make a complaint.

“It’s the ultimate run around,” he said. A string of collapses and financial problems dogging the construction-industry has also driven a spike in complaints to the Ombudsman.

The number of construction-related disputes has jumped from around five per cent to more than 10 per cent since 2021. Mr Billson said the increase coincided with “the rising number of insolvencies in the…sector”.

The Ombudsman cited as an example a family enterprise that had not been paid.

“This was affecting their ability to pay their own subcontractors. As a result of these difficulties, a family member working in the business also suffered mental health problems,” he said.

Overall, the Ombudsman has handled more than 40,000 disputes since it commenced operations in 2016.

Source: ASBFEO


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