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September 3, 2009

Banking and loan complaints dominate FSA statistics

by Gill Montia

Story link: Banking and loan complaints dominate FSA statistics

The Financial Services Authority (FSA) has for the first time published figures showing the volume of complaints regulated firms have received from their customers.

The data covers the period 2006 to 2008, during which time the number of complaints increased by 5.7%, from 1.4 million to 1.48 million.

Customer discontent over banking and loan products accounted for over half of all complaints with a spike in numbers occurring in the first half of 2007, caused by complaints about overcharging and poor customer service.

Between the second half of 2006 and the first half of 2007, the number of complaints about banking and loans products soared by 122%, to 744,253.

During the same period, the number of complaints relating to overcharging rocketed by 259%, to 470,542 and those relating to poor customer service increased 17%, to 138,125.

In the following period the trend was reversed and the total number of complaints about banking and loans products fell by 40%.

However, the regulator points out that in July 2007, it issued a waiver in connection with the High Court test case over unauthorised overdraft charges.

The waiver allowed firms to postpone dealing with some complaints relating to the charges, and has since been extended to the current period.

According to consumer groups, up to one million individuals and businesses could now be in the backlog, awaiting the outcome of their complaints.

Building societies also saw a sharp rise in dissatisfied customers with complaints more than doubling between 2006 and 2008, to 79,349.

Overall, the speed at which regulated firms handled complaints and the proportion of complaints upheld by firms remained fairly stable over the 2006 to 2008 period.

At the end of 2008, 10% of complaints took longer than eight weeks to resolve and 40% of complaints were decided in customers’ favour.

 

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