Credit, Collections & Insolvency News
The Financial Ombudsman Service (FOS) has published its latest six-monthly complaints data relating to banks, insurers and other financial businesses. The figures show that the ombudsman took on a total of around 170,000 new cases in the first six months of this year.
This represents a 13% increase in complaint figures when compared to the last six months of 2016 – and reflects rises in almost every product sector including PPI and banking.
245 businesses feature in the complaints data for the January to June period [13 for the first time]. Most of the businesses named in the complaints data for the first time operate in the consumer credit sector. The average uphold rate (where the ombudsman found in the consumer’s favour) for all businesses over the six-month period was 36% – and ranges from 3% to 79% across the individual businesses.
Caroline Wayman, chief ombudsman and chief executive of the Financial Ombudsman Service, said “We’ve seen more complaints about most types of financial products in the first half of 2017. The FCA has just launched its communications campaign, which highlights that consumers have until August 2019 to make a complaint about mis-sold PPI. While we still don’t know what impact this will have on our workload, today’s data shows that PPI complaints are already increasing.”
Payday lenders and short-term loan providers were among the worst firms to correctly decide consumer complaints. The complaints data reveals that most cases where it decided in consumers’ favour were in relation to payday lenders, short-term loan providers, and providers of credit to customers buying from retailers.
77% of complaints about WDFC UK (Wonga) and 77% of complaints about Casheuronet UK (QuickQuid and Pounds to Pocket) were awarded in favour of the complainant rather than the business.
DSG Retail (CurrysPCWorld and Carphone Warehouse) had the highest percentage of complaints upheld against it at 79%, although it only received 60 complaints over the period.
See the table below for the 10 companies with the worst complaint uphold record.
Financial providers with the worst complaint uphold rates
| Provider | Uphold rate | Number of complaints |
|---|---|---|
| DSG Retail Limited | 79% | 60 |
| WDFC UK Limited | 77% | 1,434 |
| Casheuronet UK LLC | 77% | 1,212 |
| Express Finance (Bromley) Limited | 77% | 325 |
| MEM Consumer Finance Limited | 76% | 565 |
| Shop Direct Finance Company Limited | 74% | 1,498 |
| Freemans Plc | 74% | 49 |
| HFC Bank Limited | 73% | 753 |
| Aviva Insurance Limited | 72% | 2,300 |
| Advanced Payment Solutions Limited | 72% | 42 |
Source: Financial Ombudsman Service, for the period 1 January to 30 June 2017.
In terms of the 10 providers with the most complaints, credit card providers Capital One and MBNA had the worst uphold record, at 51% and 50% respectively.
This highlights how simply measuring performance based on the number of complaints isn’t always fair, as you could expect the firms with the most customers to get more complaints than companies with fewer users.
Financial providers with the most complaints – ordered by uphold rate
| Provider | Uphold rate | Number of complaints |
|---|---|---|
| Capital One | 51% | 7,402 |
| MBNA | 50% | 4,368 |
| Financial Insurance Company Limited | 45% | 12,044 |
| HSBC | 40% | 9,044 |
| Barclays | 39% | 15,405 |
| Lloyds Bank | 37% | 18,068 |
| NatWest | 27% | 5,929 |
| Santander | 25% | 6,271 |
| Bank of Scotland | 22% | 20,541 |
| Nationwide | 16% | 4,777 |
Santander topped the most complained-about mortgage firm. The lender with the second-highest level of new complaints in the period was Lloyds, with 602, followed by Barclays (482), RBS (347) and Nationwide (299). Across the mortgage market the FOS upheld an average of 24 per cent of claims.
The complaints table can viewed here.