10May

The latest data from the Financial Conduct Authority shows that the number of complaints about authorised firms fell by 26% between the first half of 2020 and the second half of the year, from 2,960,000 to 2,160,000.

However, this doesn’t tell the full story, with the biggest reason for the decrease being a significant fall in payment protection insurance complaints – here numbers were down 77% between the two reporting periods, from 1,090,000 to 256,000. Across the entire protection and insurance group, complaints were down by 43% from 1,800,000 to 1,020,000.

Complaints about all other products other than PPI actually rose by 3.3%, from 1,870,000 to 1,930,000.

The most complained about products in 2020 H2 were current accounts (23% of all complaints), PPI (12%), credit cards (11%), other general insurance products (11%) and motor & transport insurance (9%).

Of the 2,950,000 complaints closed by authorised firms between July and December 2020, 55% were decided in favour of the customer, slightly higher than the uphold rate of 53% seen in the first half of the year. The uphold rate for PPI was 51% and for all other areas it was 57%.

The average redress paid for an upheld complaint in H2 2020 was £870, 19% lower than the equivalent figure for H1 of £1,068. However, once again PPI has the potential to distort these average figures, so the FCA also reports that the average redress on a PPI claim was £2,281, while the average compensation across all other products was just £180.

PPI complaints are also taking much longer to resolve than other complaints. During the period from July to December, 93% of the resolved PPI cases were closed more than eight weeks after receipt, whereas only 7% of complaints in other areas took this long to resolve.

A high proportion of complaints are actually closed by firms within three days of receipt, with this timescale being met for 49% of non-PPI cases, as opposed to just 2% of PPI complaints.

These statistics still exclude consumer credit complaints, as the FCA still does not have a full set of data from all of the firms in this sector. Financial Ombudsman Service data indicates that complaints in this sector have been rising significantly for some time. Furthermore, complaints about home finance from firms that were included in the data increased by 19% from 8.1 to 9.6 per 1,000 balances outstanding.

In the firm-specific complaints data, the firms with the most complaints are almost all high street banks, building societies or large insurers. However, a major utility provider gets into the top five, by virtue of having a very large number of insurance complaints.

Many consumer credit firms are included in the firm-specific data, although their results are still reported separately from other firms. The five firms with the most credit complaints are:

  • A high street clothing retailer (51,804)
  • A doorstep lender (41,060)
  • A guarantor lender (32,936)
  • A high street bank (26,272)
  • A merchant bank (21,892)

Excluding firms who had very high uphold rates from small numbers of complaints, the credit firms with the highest uphold rates are:

  • An instalment loan provider (83.5%)
  • A general insurer (81.9%)
  • A high street bank (81.8%)
  • A vehicle leasing firm (79.4%)
  • A bank attached to a supermarket (75.6%)