After several years when dispute numbers fell, the Financial Ombudsman Service has reported a seven per cent increase in disputes received in the year to June.FOS received 34,095 disputes last financial year, compared with 31,895 in 2014/15.FOS chair Michael Lavarch said the increase was unanticipated."It is higher than what we anticipated, based on what we understood from our members about the improvements they were making to provide better customer service and internal dispute resolution," Lavarch said.General insurance disputes accounted for most of the increase. The number of general insurance disputes increased by 1721 - almost 90 per cent of the overall increase.Chief ombudsman Shane Tregillis said a key problem was financial services providers failing to pay FOS determinations. FOS has long pushed for a compensation scheme of last resort.Ninety-four per cent of FOS's 13,576 members had no disputes lodged against them during the year. Of the 835 that did have disputes lodged against them, 351 had one dispute and 120 had two.At the other end of the scale, 47 members had more than a hundred disputes lodged against them, compared with 54 last year, and another 22 had between 51 and 100 disputes.Member numbers fell 3.8 per cent to 13,576. Licensee member numbers grew 14.3 per cent to 5540, while authorised representatives fell 13.2 per cent to 8036.New members were mostly accountants and financial planners. FOS said the reduction in authorised representatives was a result of businesses modifying their licences to no longer provide credit services.Consistent with previous years, credit products accounted for around half (45 per cent) of disputes received. The vast majority of credit disputes were about consumer credit and the most common issue was financial difficulty. Deposit taking accounted for nine per cent, payment system eight per cent. The majority of payment disputes were about direct transfers.Other disputes were about general insurance (29 per cent), life insurance, investments and investment advice and trustee services.Of the 22,376 disputes that were accepted and entered the case management stage, 9858 were about banks, covering issues such as financial difficulty, credit decisions, privacy and confidentiality, transactions and charges.More than 4500 credit listing were amended or removed.During the year FOS completed organisational and process improvements that were recommended in an independent review in 2013.As a result, FOS now has a process that fast-tracks simpler and lower value disputes. The average dispute resolution time came down from 95 days in 2014/15 to 62 days last financial year.