Following the FCA’s announcement to streamline complaints data reporting requirements for firms, Dom House, Lead Consultant at Simplify Consulting, said:
“The FCA complaints review announced today represents a step forward for complaints processes. Simplification of complaints reporting should help firms who are currently completing multiple returns to reduce the burden of collation and submission, and should reduce the risk of mis-reporting.
In addition, and perhaps the biggest improvement in how complaints are viewed across the industry is that this will enable complaints data to be processed more efficiently by the FCA. As data becomes more important across the industry, and at the FCA itself, improvements to the quality and availability of the data should enable firms to make better and smarter comparisons with where they sit within the market and against their peers. With the evolution of Consumer Duty more and more firms will be looking at this data to identify where their areas of focus should be.
While complaints to the FCA in 2024 H2 fell to 1.78m, this represented just a 4.3% decrease from 2024 H1 and remains disappointing overall.
Complaint volumes across all FCA regulated firms have continued, on average, to increase over the last 10 years but now, around 22 months into Consumer Duty, it seems the industry is still to move the dial significantly when it comes to customer complaints. Our own research into this area found that 76% of complainants said it had impacted their loyalty to their provider, with 18% having moved provider as a result of their complaint.
To my mind, financial firms that can build an effective complaints strategy, analysing the root cause of complaints rather than relying on over-arching regulation, will not only be delivering better outcomes for clients and be meeting Consumer Duty requirements, they might well reduce the risk of losing a large proportion of their clients.”
