Complaints About the Financial Industry Continue to Rise!

by Mark Johnston

Complaints About the Financial Industry Continue to Rise!

It seems that there has been a lot to complain about in banking over the last few years and the number of Britons forced to complain to the Financial Ombudsman has hit its highest level ever.

The organisation settles disputes between consumers and financial businesses.

end is nearThe Financial Ombudsman Service (FOS) has seen a 179 per cent increase in complaints about financial products and services in the first quarter of the 2013/14 financial year.

The service received 159,197 new complaints in the three-month period compared with 57,076 in the same period last year, according to figures recently published.

Unsurprisingly, major banking groups dominated the list of most complained about firms, with Lloyds Banking Group, Barclays, The Royal Bank of Scotland and HSBC collectively accounting for over 60 per cent of total complaints in the second half of 2012.

Some banks’ customers are however better off when it comes to likelihood of having problems, customers of First Direct and Nationwide reported the fewest problems.

Poor customer service was the most common problem overall, followed by banks trying to sell inappropriate products and difficulty getting through to someone.

Data shows that the state backed Lloyds Banking Group topped the table of most complained about firms.  Nearly one in three of the 283,251 new complaints received by the ombudsman in the second half of the year related to the bank.

Payment Protection Insurance claims again made up the bulk of all complaints with more than 132,000 claims received between April and June this year. This represented 83 per cent of all consumer gripes.

The Financial Ombudsman Service (FOS) said its job of adjudicating had been made more difficult by allegations of corrupt complaints such as the Lloyds scandal earlier this year.

Although many banks have been criticised for delaying payouts to those mis-sold payment protection insurance (PPI), earlier this year, Lloyds was fined £4.3 million by the Financial Services Authority (FCA) for dragging its feet over compensating customers.

Elsewhere, there was an 84 per cent rise in complaints to Industry watchdog about payday loans compared with last year.

Richard Lloyd, executive director of the consumer group Which? suggest that “these figures show that banks were still letting their customers down. Therefore the Financial Conduct Authority must take tough action against any bank found dragging its feet in settling complaints. It is time for a big change in banking, with banks that work for customers, not bankers.”

A spokesperson for the Financial Ombudsman Service (FOS) suggested that “Banks need to sort out their complaints so we that we can focus on what we are supposed to be doing, which is sorting out individual complaints.”

In conclusion some financial industry experts feel that to win back our trust lenders must sort out their complaints handling. When things go wrong it is critical that banks act swiftly and fairly to deal with the problem, identify what caused it and make sure it is not repeated.

 



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