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Bank complaints handling continue to let down customers, reveals new Consumer Focus r

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  • Bank complaints handling continue to let down customers, reveals new Consumer Focus r

    Bank complaints handling continue to let down customers, reveals new Consumer Focus research

    Published: 19 February 2011
    Three quarters of customers with a grievance against their bank make a complaint, but fewer than half of those who complain (47 per cent) are happy with the response they receive, according to new Consumer Focus research.1
    The banking industry attracted more than 1.25 million complaints in the first half of 2010 alone2. The consumer watchdog found that despite being dissatisfied with the initial response from their bank, less than a third (31 per cent) of people then pursue the complaint further. Of these people just nine per cent take their complaint to the Financial Ombudsman Service. This is despite evidence suggesting that if consumers do pursue their complaint they can receive a better result than they might expect. Research on consumers who have used the Ombudsman service shows that nearly three-quarters feel it provides a “fast and efficient service” and that consumers receive compensation in half of the cases it reviews.3
    Consumer Focus is calling for banks to take complaints more seriously and devote more resources to improving customer service. The consumer champion is also urging the Financial Services Authority (FSA) to continue using the prospect of financial sanctions to keep the pressure on poorly performing firms. The FSA previously concluded that banks’ complaints handling is ‘poor’ with more than a third underperforming in this area.4
    Oliver Morgans, financial services expert at Consumer Focus said:
    ‘Customers are willing and able to fight their corner and take the first step of complaining. The problem is they then seem to become disheartened by the banks’ poor service and complaints systems. Unfortunately, persistence appears to be the key to getting the answer you would like from your bank.
    ‘These findings should be a wake-up call for banks who must do more to improve their complaint handling practices. Decent customer service is a necessary part of a healthy market and a successful company. The evidence suggests banks are currently falling a long way short.’
    Consumer Focus thinks that poor customer service and complaints handling is a sign of weak competition. Banks should be using good customer service as one way to differentiate themselves from their competitors, to attract and keep customers and to learn more about how they are performing. Consumer Focus analysis of complaints data from the banks and the Ombudsman shows significant differences on customer service, with some banks performing much better than others.5
    If banks don’t raise their game when it comes to complaint handling, consumers should be able to take their custom elsewhere. Despite the level of industry complaints, three-quarters of customers have never even considered switching their current account to another bank. Fear of costs when things go wrong, the effort involved and fear of a negative effect on credit rating are key reasons why consumers are reluctant to switch.6 Consumer Focus thinks that if switching was easier and people were more willing to vote with their feet, it would put power back in the hands of consumers, and put pressure on banks to make the market more competitive.
    To improve complaint handling for bank customers Consumer Focus is calling for:
    • Strong enforcement action by the FSA against poor complaint handling practices and for the unfair treatment of customers.
    • Details of the Financial Ombudsman Service to be given when a consumer first registers a complaint, along with an update at four weeks if the complaint still isn’t resolved. That way customers know there is an independent third party if they are unhappy with the result and this may help motivate them to keep going with a long-running complaint.
    • Changes to the publication of complaints data so that consumers know which banks are (and are not) performing including:
      • FSA complaint data to be broken down by banking products and always by High Street brand not parent company
      • Complaints data to be provided so it can be compared against a bank’s market share
      • The regulator to publish how many complaints are resolved at four weeks so consumers can see which banks have a good track record in resolving complaints quickly.


    ENDS
    Notes to Editors:
    1. Telephone research with a nationally representative sample of 2,000 people was undertaken by GfK NOP in December 2010 and January 2011.
    2. Firms are required to report to the FSA every six months on the number of complaints they receive and how they handle them: See FSA complaints data Sept 2010
    3. The Financial Ombudsman Service’s latest annual report
    4. Financial Services Authority, Review of complaint handling in banking groups, April 2010, p11
    5. Graphs showing FSA and FOS complaints data, January-June 2010.
    6. In October 2010, Consumer Focus issued a report investigating levels of switching in the personal current account market. The report concluded that the market had lower switching levels than other domestic markets including energy, telecoms and insurance.


    Bank complaints handling continue to let down customers, reveals new Consumer Focus research Consumer Focus
    Tags: None

  • #2
    Re: Bank complaints handling continue to let down customers, reveals new Consumer Foc

    I have to say that I think that perhaps the FSA should publish the timescales involved and what correspondence the bank should send out and the timescales involved.

    If it is helpful I'm happy to do so on here
    "Family means that no one gets forgotten or left behind"
    (quote from David Ogden Stiers)

    Comment


    • #3
      Re: Bank complaints handling continue to let down customers, reveals new Consumer Foc

      Well from start to finish mine took 2 and a half years so yes the banks have a lot of work to do.
      If you think nobody cares if you're alive, try missing a couple of payments.

      sigpic

      Comment


      • #4
        Re: Bank complaints handling continue to let down customers, reveals new Consumer Foc

        Originally posted by pompeyfaith View Post
        Well from start to finish mine took 2 and a half years so yes the banks have a lot of work to do.
        Yours went to the FOS and this is not what the article is about.
        "Family means that no one gets forgotten or left behind"
        (quote from David Ogden Stiers)

        Comment


        • #5
          Re: Bank complaints handling continue to let down customers, reveals new Consumer Foc

          Yes it did but that is not the point, the point is it should never have gone that far in the first place.

          The Bank knew I had a legit claim from the first letter which they throw out the point is too many complaints are being turned down on first letter and do not even get investigated and that is wrong.
          If you think nobody cares if you're alive, try missing a couple of payments.

          sigpic

          Comment


          • #6
            Re: Bank complaints handling continue to let down customers, reveals new Consumer Foc

            Originally posted by pompeyfaith View Post
            Yes it did but that is not the point, the point is it should never have gone that far in the first place.

            The Bank knew I had a legit claim from the first letter which they throw out the point is too many complaints are being turned down on first letter and do not even get investigated and that is wrong.
            The first letter they would not know it was missold without actually investigating the complaint. They can take up to 8 weeks to do so but the article is about the responses that they give during that timeframe.
            They should acknowledge the letter within 48 hours of receipt even if they cannot provide a final response, they then should update you every 2 weeks with any progress and after 8 weeks you then have the right to go to the financial ombudsman. Personally I think the FOS should have specific guidelines to deal with complaints where 8 weeks in a timescale they are unable to complete since when it goes to the FOS they would usually require a "final response"
            "Family means that no one gets forgotten or left behind"
            (quote from David Ogden Stiers)

            Comment


            • #7
              Re: Bank complaints handling continue to let down customers, reveals new Consumer Foc

              The first letter they would not know it was missold without actually investigating the complaint.


              Exactly Nattie and that is the point many have been turned down without an investigation like I said that is wrong.

              In my case an offer was made on the second letter so what does that tell you about the first letter this offer was not accepted by me as that offer was wrong anyway.

              It is a well known fact that first letter complaints are turned down in the hope the consumer will take the matter no further and in many cases this is the case.


              If you think nobody cares if you're alive, try missing a couple of payments.

              sigpic

              Comment


              • #8
                Re: Bank complaints handling continue to let down customers, reveals new Consumer Foc

                Originally posted by pompeyfaith View Post


                Exactly Nattie and that is the point many have been turned down without an investigation like I said that is wrong.

                In my case an offer was made on the second letter so what does that tell you about the first letter this offer was not accepted by me as that offer was wrong anyway.

                It is a well known fact that first letter complaints are turned down in the hope the consumer will take the matter no further and in many cases this is the case.


                If they could have resolved your complaint within 48 hours then even I would be gobsmacked especially on a complaint on PPI misselling. It simply is an unrealistic expectation. If it was say, a cheque not credited to the account then yes it is a realistic possibility of resolving within the first 48 hours.

                The first letter SHOULD be an acknowledgement letter(that is mandated by the FSA guidelines on complaint handling), the second should be within 2 weeks which may or may not include a resolution.

                You are confusing what I am saying as well. I hardly ever sent out a first letter refusing a complaint(bank charges ones were a given where there was no bank error/extenuating circumstances). A lot of timescales are FSA rules. With regards to declining a complaint, yes, you can do this but you have to give a reason why you are declining it. The first letter has to merely an acknowledgement of the complaint.(I think I might also be missing one letter in my timescales as well......will see if I can find that)....
                "Family means that no one gets forgotten or left behind"
                (quote from David Ogden Stiers)

                Comment


                • #9
                  Re: Bank complaints handling continue to let down customers, reveals new Consumer Foc

                  I've got the original draft rules from 2000. Page 36 gives a timescale but I think these rules were clarified even further nearer to the time which I'll find.
                  http://www.fsa.gov.uk/pubs/cp/cp49.pdf
                  "Family means that no one gets forgotten or left behind"
                  (quote from David Ogden Stiers)

                  Comment


                  • #10
                    Re: Bank complaints handling continue to let down customers, reveals new Consumer Foc

                    FSA Handbook - Full Handbook

                    That is the current timetables but I know we worked on the process of a letter being sent out of acknowledgement after 48 hours, holding letter after 2 weeks(unless complaint resolved), then 4 weeks and usually after that period of time it may get referred to a central complaints team who would deal with FOS complaints who would complete the response from the banks' perspective prior to referral to the FOS.
                    "Family means that no one gets forgotten or left behind"
                    (quote from David Ogden Stiers)

                    Comment

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