PPI figures are indefensible says complaints boss.

Wed 29th May 2013

The Financial Ombudsman Service (FOS) released its annual review today (May 29), which revealed that its caseload had almost doubled in year 2012/13 as it tackled half a million new complaints. 

However Paul Clark, CEO of Charter UK, says that whilst at first glance the FOS figures look very negative it's important to distinguish that 74 per cent of these were PPI related. "In our experience, Best Practise in Complaints Management is about understanding the root cause of customer dissatisfaction and using this insight to improve," he said. 

"Yet the root cause of PPI has long been established, the product isn't being sold anymore so nothing more can be learnt from it. However the fact that 65 per cent of PPI complaints were upheld in the consumer's favour is indefensible, making it clear that some organisations need to overhaul the processes they are using to handle PPI claims."

Mr Clark points out that what the FOS figures do not show, is that if you take PPI out of the equation, some banks are making significant improvements in reducing their business as usual complaints and this is reflected in decreasing uphold rates for complaints of this nature that are referred to the regulator. 

"The issue in financial services is a lack of consistency - we see the industry generally adopting two approaches," he says. "There are those whose culture will always be to do the bare minimum to just ensure regulatory compliance and others who are investing in service excellence. 

"The latter approach means taking an enterprise view of complaints across the entire organisation and looking at people, processes and platforms to identify the root cause of complaints, and apply these learnings to the business. Banks taking this forward thinking approach will see that they can leverage complaints for economic value and improve customer centricity as a direct outcome. 

However he warns that those just striving for regulatory compliance alone face significant risks. "These are the banks that will find themselves standing still and constantly falling foul of the regulator and their customers alike."