Some of Britain’s biggest financial firms have been told to improve the way they handle customer complaints after the regulator uncovered “weaknesses” ranging from overly officious letters to expensive phone lines.
After reviewing practices at 15 companies, the Financial Conduct Authority said it was clear firms “could – and should – do more to deliver fair complaint handling and consistent outcomes for all consumers”.
The 15 unnamed companies – seven high street banks, two building societies, three general insurers and three life insurers – have all agreed to make changes. Some are now retraining staff following the review, which did not deal with complaints about payment protection insurance as these have been dealt with separately.
Among other problems, the FCA found inconsistencies in the amounts of compensation offered to customers with valid complaints, particularly relating to the distress and inconvenience they had suffered. Typically, the first-point-of-contact staff offered lower amounts of redress than those higher up the chain.
The regulator also found that some of the response letters sent to people who complained were “unnecessarily long and confusing”.
Recommendations included:
• Ensuring calls to dedicated complaints phone lines cost no more than the basic rate.
• Making sure firms that use freephone 0800 and local rate 0845 numbers also provide an alternative 03 number for customers using a mobile phone.
• Changing the rules so all complaints have to be reported to the FCA. At the moment firms do not need to report complaints resolved by close of business on the working day after they are received.
The FCA said financial firms were also trying to make their letters to complainants more consumer-focused. Some companies are now getting help from external communications experts to improve their letters, and trying to take a leaf out of the book of non-financial services companies.
“As a result, some firms’ responses are becoming less ‘legalistic’ and adversarial, which results in more readable and more easily understandable correspondence,” said the regulator.
It added that some improvements and innovations had already been made. For example, senior management were now more engaged with complaint handling.
