Financial firms are not providing the level of customer service necessary to succeed or keep customers in the tough economy. Phil Jones, campaigner on personal finance for Which? indicated that the finance industry needs to go through dramatic changes for the future.
Jones said that the number of unhappy customers is a “poor reflection” on the financial industry, that financial firms are not treating customers the way they should and that the industry needs to make some dramatic changes if it wants to salvage its reputation.
Jones indicated that there is a veil protecting offending companies, making it more difficult for consumers to choose banks, lending partners and credit card companies wisely.
He said that consumers need access to more information about firms, especially complaints, so they can make informed choices about banks, lending partners and credit card companies.
The FSA’s current plan for identifying financial firms that are failing customers calls for groups to be identified but not individual firm names and is not helpful to consumers. For consumers, the name Lloyds Banking Group, will mean nothing, whereas Halifax may be the common firm name in their area.
Which? wants all complaints on individual financial firms, including whether complaints were remedied or not, to be made publicly available to consumers. The campaigners are seeking full details of complaints about individual products offered by each financial institution or firm.
In addition, Which? wants information in the publication to be consistent with the Financial Ombudsman Service, to provide the percentage of complaints versus the percentage of remedies, and to reflect the size of the business.
Compared to the first six months of 2006, the last six months of 2008 saw a 32% rise in the number of complaints against banks, going from 760,000 to 1,003,000. Complaints to credit card companies rose nearly 50%, from 73,500 to 151,000 and complaints concerning current accounts rose by 46%, from 368,000 to 536,000.
The most common complaints are those related to customer service. Complaints about poor customer service increased by 28% in 2008, rising from 187,000 to 239,500. The number of complaints remedied by banks fell from 49% to a mere 38%.
In addition, Cash ISAs, General Insurance and Pure protection products all saw increases in complaints of 20% or higher. The most significant increase in complaints between 2006 and 2008 was due to unfair and unauthorised overdraft charges being made on accounts.
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I am shocked by the state of Financial Services in this country. However even more shocking is that consumer organisations, government and OFT are totally unable to execute any changes. So called credit scoring TABOO agencies, refusal to make their policies, processes and scoring clear is ridiculous. The whole system is corrupted by lack of clear rules, transparency and arrogant, uneducated banking advisors.
Example: can you decline current account on the basis of one missed credit card payment? Yes or not? If yes, will this rejection go on the rating score to make so called rating worse. What is good rating? What is average rating and what is poor rating? Finally how to order credit report without GETTING SUBSCRIBED TO THE EXPERIAN ON THE BASIS OF AUTOMATIC RENEWAL TERMS (BTW unfair term in their terms and conditions…). How blooming upsetting is this????
EDYTA35 –
Banks don’t make their credit scoring policies public knowledge so as to avoid unscrupulous clients manipulating them. By keeping them restricted knowledge, neither customers nor staff can play the system. It is neither corrupt nor arrogant, it simply serves to decline clients who are not able to manage their money and would result in a bad debt – this in turn affects profits and then charges need to increase for customers across the board. No doubt you would say this is unfair also – so they can’t win! It is purely designed to protect the good customers, which is the vast majority.
Your comment about banking advisors being uneducated is far from accurate and rather insulting. They are very well trained, often undertaking degrees in various banking disciplines at the same time as working full-time. They are highly trained in compliance and banking products, and have to undertake regular MOT’s, checks, and have supervised meetings to ensure they remain completely up to date and compliant with the FSa’s regulations.
You can obtain a copy of your credit report from Experian or Equifax for a one-off payment of £2; you can either post them a cheque or postal order along with the form you can print off their website, or you can pay by card on the site itself. The card must be in the same name as the report is being ordered in.
I doubt that transparency would allow customers to play the system. I have just ordered a copy of my Credit Report from Experian. Another adventure from these highly educated bunch. I have ordered the most detailed version, updated my address, email and card details. Two days later I noticed that Experian charged me £6.99. It would be no problem at all if they only once mentioned that they going to take money from my account and how much. They obviously put it in small print somewhere but plastered FREEE all over the website. Of course they did not provide any receipt or notification. I would not mind paying at all. I DO mind if they take it without asking. AND THEY ARE THE PEOPLE TO PROVIDE REFERENCE ABOUT MY CREDIT RELIABITY??? I am very very worried…