FCA reports surge in complaints

The Financial Conduct Authority (FCA) reported that financial services firms paid out £283 million in redress for complaints in the first half of 2025, a 20% increase from £236 million in the previous half.

The FCA received 1.85 million complaints, marking a 3.6% rise compared to the second half of 2024. Complaints about banking and credit cards rose by 7.2%, while those regarding pensions increased by 5.5%. The most complained about products included current accounts, motor and transport, and credit cards. The upheld complaint rate remained steady at around 57%.

Home finance complaints fell by 6% in the first half of 2025 compared to the previous six months, while overall financial services complaints increased by 4%.

The data shows that home finance complaints fell by 6.3% from 83,936 in the second half of 2024 to 78,641 in the first half of 2025.

Meanwhile, financial services firms received 1.85 million complaints, up from 1.78 million in the second half of last year. Since the first half of 2021, complaints have remained relatively constant, ranging between 1.7 million and 2million.

There were changes in the three most-often complained-about products, with current accounts (Banking and credit cards) increased from 491,172 in 2024 H2 to 541,493 in 2025 H1 (10.2%). Motor and transport (Insurance & pure protection) increased from 254,788 in 2024 H2 to 255,192 in 2025 H1 (0.2%), whilst credit cards (Banking and credit cards) decreased from 217,160 in 2024 H2 to 211,903 in 2025 H1 (2.4%).

The total amount of redress paid in the first half of this year totalled £283 million, a 20% increase from £236 million in the last six months of 2024, with the average compensation payment rising from £207 to £238.

The percentage of complaints that were upheld by firms remained around 57% between H2 2024 and H1 2025.

Product groups that saw an increase in complaint numbers included banking and credit cards, which rose by 7%, decumulation and pensions went up by 6% and investments saw a 10% increase.

Alongside home finance complaints, insurance and pure protection complaints fell by 0.2%.

Commenting on the figures, Phil Smith, Senior Actuarial Consultant at Broadstone, said “Given the scrutiny on consumer outcomes and fair treatment from the regulator, it is perhaps unsurprising that we are seeing increases in complaints.

“With the number of complaints being upheld remaining consistently high as well as increases in both total and average compensation payments, it is clear that firms have work to do to ensure they are treating their customers fairly.

“Redress remains a costly outgoing for firms – as the ongoing motor finance case should be a reminder of – so it quite literally pays to treat customers well.”