Author: By James Moore, Deputy Business Editor
The Financial Services Authority (FSA) yesterday unveiled proposals that would force financial companies to publish the numbers of complaints they receive across five key consumer product areas: banking, mortgages, general insurance and protection, life and pensions, and investments.
While the proposals have been put out to consultation, a spokesman said it would take “a very strong argument” for them not to be enforced.
Under the plans, companies would have to publish the complaints data by next July. The FSA then intends to collate the information into league tables by September. The listings would be “value added” so they do not penalise the bigger companies that inevitably attract more moans, with the number of complaints per 1,000 customer accounts published.
Companies would also have to reveal the percentage of complaints against them that are upheld and the percentage which are dealt with within two months. Dan Waters, the FSA’s director of retail policy and conduct risk, said last night: “Publishing complaints data will mean that people can learn more about how firms handle complaints and the frequency with which they arise. We also consider that publishing this information will incentivise firms to deal more effectively with complaints and help to raise industry standards in this important area.
“It is essential that the information is meaningful and genuinely brings benefits by enhancing customers’ experiences of the firms they deal with.” The FSA has come under fire over its perceived poor handling of the credit crisis, but the latest proposals offer it a chance to show that it “has teeth”.
Financial institutions have for a long time had to prove to the FSA that they handle complaints effectively and fairly but this would be the first time such data has been made public. However, industry experts took a dim view of the plans. Angela Knight, of the British Bankers Association, said she was concerned that banks would end up simply settle unjustified complaints rather than fall down the league table.
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