The Financial Services Authority (FSA) has published aggregated data on complaints received by firms for the first time. The information has been collected since 2006 but has not been made public until now.
Specific firms are not ‘named and shamed’, but aggregate figures are given for different product groups. Over 1m complaints were received by banks in the last six months of 2008 – an increase of 32% from the first six months of 2006.
Bank related complaints rose significantly in several areas over the three-year period under review, with those about Cash Isas quadrupling from 8,700 to 39,250 and those about credit cards doubling, from 73,500 to 151,000. Complaints about current accounts rose by 46%, to reach a total of 536,000. The most recent figures exclude complaints about bank charges for unauthorised borrowing, 1.2 million of which are still pending, following the FSA waiver and ongoing court proceedings.
If you’re unhappy with your bank, follow our guide to making a complaint.
Complaints about insurance products doubled from 2006 to 2008, largely as a result of increased complaints about Payment Protection Insurance (PPI). For more on this see the Which? advice guide on PPI mis-selling.
Financial product providers rejected a larger percentage of complaints in 2008 than they did in 2006, with just 40% upheld in the last six months of 2008, compared to 49% in the first six months of 2006. For banks the percentage upheld fell from 49% to 38%.
This trend contrasts strongly with figures reported in the Financial Ombudsman Service (FOS) 2008-09 Annual Review, which has seen an increase in the amount of complaints being upheld. This would suggest financial firms are rejecting higher levels of valid complaints.
Commenting on the year’s cases, the FOS review says: ‘In the financial year 2008/09 we upheld 57% of the complaints we dealt with. This means that in almost six out of 10 cases, the outcome of a consumer’s complaint following investigation by a financial business was changed in favour of the consumer as a result of our subsequent involvement. This uphold rate is higher than in any previous year.’
Responding to the FSA figures, Which? personal finance campaigner, Phil Jones said: ‘It’s a poor reflection on the industry that there are so many unhappy customers out there. Financial firms simply aren’t treating consumers well enough and things must change if the industry is to rebuild its reputation.
‘Consumers need more information about which firms are being complained about and why, so they can make more informed choices when shopping around for financial products.’
What Which? wants:
- The FSA to publish, in full, the complaints data it receives from individual firms, including the amount of redress received by consumers.This should include complaints to individual firms broken down by detailed product areas. The FSA’s existing proposals opt for just five product areas but Which? believes this does not reflect the huge range of financial products on offer.
- Complaints to be published by individual trading name. The FSA’s proposals say that complaints should be published by firm, not individual trading name. This means, for example that complaints made against Lloyds TSB or Halifax could come under the umbrella of Lloyds Banking Group rather than the individual brands, making the data less helpful to consumers.
- The threshold for complaints publication should reflect the size of business.
- The information to be consistent with that published by the Financial Ombudsman Service on the number of cases where the consumer referred their case to the Ombudsman and the percentage of cases upheld in favour of the consumer.
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