It seems that in these tough economic times, consumers are reading up on their rights. The financial ombudsman says that the number of cases that turned into formal disputes in 2012/13 was 508, 881 – almost double the previous year – out of a total of two million enquiries handled. Not surprisingly, the annual review also said that claims against the mis-selling of payment protection insurance dominated, making up around three-quarters (74%) of all complaints.
Four of the UK’s biggest banks, Barclays, Lloyds, RBS and HSBC were responsible for 62% of all claims, up from 52% the previous year. No doubt thanks to the dodgy-sounding claims companies that have sprung up all over the place, often promising compensation to people who never had PPI in the first place. Who hasn’t been harangued by one of these?
The ombudsman’s report also pointed to a big rise (34%) in complaints about current accounts. Most of these complaints were from people who had found themselves in financial difficulty, and found that their bank would suddenly remove their overdraft facility, or make it overly difficult to cancel payments. Mortgage complaints also went up by 25%, mostly because of poor calculation resulting in incorrect monthly charges being levied.
Natalie Ceeney, the chief ombudsman, hinted that banks are not doing enough to sort out their handling of complaints. ‘We have seen a much stronger consumer voice in the last year − with people becoming more aware of their rights and less willing to put up with poor customer service,’ she said. ‘As levels of confidence in financial services have eroded, it is disappointing that we still haven’t seen any significant improvement in complaints handling. Too many financial businesses still seem unable to sort out problems themselves, without the ombudsman having to get involved.’
Banks are obviously keen to put the whole PPI thing behind them, since it has cost them billions of pounds each. It’s no wonder therefore that they have been trying to get a cut off date applied after which no one can successfully claim compensation. But the ombudsman says around half of all disputes resulted in compensation for the claimant, suggesting there’s life in the old dog yet.
Oh, and Ceeney also told the Telegraph this morning that the ombudsman service is hiring another 1,000 people in the next six months (adding to 2,600) to deal with the rising numbers of complaints. There isn't actually a single 'ombudsman' - there's a whole army of them. We can’t help thinking it’s just good old-fashioned karma…