Total complaints made to financial services firms are falling, but the number of non-PPI complaints is rising, with significant increases for some products.
The latest complaints data from the Financial Conduct Authority indicate that complaints about authorised firms are at their lowest level in almost five years. However, the total number of complaints made to financial firms in the first half of 2021 was still in excess of two million.
Between January and June this year, 2.04 million complaints were recorded. This is 7% down on the 2.19 million recorded in the second half of 2020 and is the lowest six-monthly figure since H2 2016.
Whilst the overall picture is one of decreasing complaint volumes, there were still fairly significant increases in some product areas. Complaints about decumulation and pensions were 26% higher in H1 2021 than in H2 2020, while investment complaints rose by 18%.
Home finance complaints reduced by 11% between the two periods, while there was a slightly larger fall (13%) in general insurance and pure protection complaints. However, this 13% decrease was largely due to a 78% drop in payment protection complaints – a product where many types of complaint are no longer accepted – and a 63% fall in travel insurance complaints, where the spike seen in previous reporting periods was attributed to issues related to Covid-19.
Excluding PPI, the total number of complaints actually increased between H2 2020 and H1 2021.
To further illustrate that there is little room for complacency, despite the fall in overall complaint volumes, the FCA has identified several areas where complaint numbers have increased significantly over the last few years. Complaints about platforms have doubled from the 8,431 reported in H2 2019 to the new figure of 17,090. Workplace pension grievances have almost doubled between H2 2017 and the latest reporting period, rising from 7,642 to 14,974.
When we look at the 2.16 million complaints closed by firms during H1 2021, 59% of these were upheld, up from 55% in the previous six-month period. The total redress paid for products other than PPI increased by 27% from £223.9m to £284.5m over the same period, even though there was a 61% decrease in the redress paid across all product areas. Average redress for a PPI case is £3,119, compared to just £221 for other products.
These headline figures still don’t include the thousands of firms who are only authorised for consumer credit activities, as not all firms in this sector have been required to submit a full set of complaints data so far. However, the regulator does publish information from the credit firms that have submitted their complaints data, and these show a number of firms with more than 10,000 cases during the six months, and some firms with uphold rates as high as 90%.
At Scott Robert we understand that not having the required processes and controls in place can easily lead to an increase in complaints, upheld complaints and potentially paying out large amounts of redress to customers. We have experts available to review and offer advice over your complaint handling processes and controls in place to minimise the risk. We can also assist in reviewing complaints, conduct investigations, draft final responses and working collaboratively with your business and Complaints Officer(s) to resolve complaints.
Speak to one of our experts today to find out more by calling 0161 914 5727.