FSA calls on banks to overhaul complaints handling as customer grievances soar
30 September 2010 | 7433 views | 0
The Financial Services Authority (FSA) plans to shake up its complaints handling rules after revealing that more than 7000 gripes against high street banks are lodged every day, with Lloyds topping the league of shame.
In a first, the watchdog has published firm-specific data, revealing that in the first six months of 2010, the Lloyds Banking Group generated 288,717 complaints. Barclays and Santander both drew around 250,000 complaints, RBS 140,000 and HSBC about 80,000.
Lloyds fares better when it comes to promptly dealing with complaints. According to the BBC, its Lloyds TSB business handles 97% within the recommended eight weeks. Barclays dealt with 91% of cases within two months but Santander managed just 46%.
Santander last week outlined plans to create around 400 call centre jobs in an effort to get to grips with its woeful reputation for dealing with customer complaints.
The FSA is now calling for a mandated overhaul of complaints handling rules to drive up standards. The watchdog's proposals include requiring firms to identify a senior individual responsible for complaints handling, the abolition of the 'two-stage' handling rule, and better root cause analysis to tackle recurrent or systemic problems. It is also stipulating an increase in the amount customers can be awarded from £100,000 to £150,000
Sheila Nicoll, director, conduct policy, FSA, says: "Good complaints handling standards should be the rule not the exception and complaints handling forms a key part of our intensive and intrusive approach to supervise how firms deal with their customers."
Barrie Neill, banking consultant at technology vendor SAS says that social media has changed the complaints landscape and banks need to adjust to this.
"Online forums and social networks have broadened the arena for customers to air their grievances and the reach of these sites has deepened the impact of a single complaint. Where once a complaint form went straight to the bank, negative comments made online are now shared with thousands - if not hundreds of thousands - of people."