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Last Updated: Tuesday, 2 May 2006, 09:12 GMT 10:12 UK
Bank complaints 'could go to FSA'
Bank
Customer dissatisfaction appears to be rising
A banking industry watchdog has warned it could report banks to the Financial Services Authority unless they improve their handling of customer complaints.

The warning is contained in a recent report issued by the Banking Codes Standards Board (BCSB).

It says bank customers have been increasingly upset about the way that banks deal with their complaints.

More than one in 10 of the complaints the BCSB received between January and October 2005 were about this issue.

In each of the two previous years, such complaints amounted to less than 2% of the total.

The banking code is a set of voluntary rules which govern the way banks and building societies deal with their personal customers over their current accounts, personal loans, savings and credit cards.

Upsurge in complaints

In March 2005, banks and building societies sent a leaflet to all their current account customers outlining a revision of the code.

The upsurge in complaints came hard on the heels of the leaflet campaign.

By August, complaint numbers had returned to their normal levels - although the surge meant that for the whole of 2005, the helpdesk team at the BCSB received 3,500 complaints, which was 50% more than in 2004.

A spokesman, Adrian Lloyd, said he was concerned about other areas of complaint: "Recently we've seen complaints about high interest rates and default charges, where people exceed their overdraft limits or are late paying their credit card bills."

The BCSB said it was worried that complaints about poor complaint handling accounted for 11% of 2005's higher overall figure number.

The watchdog said that as people tended to contact it only as a last resort, it was worried that this might be only the tip on an iceberg.

It warned that if bank compliance officers were not vigilant over their complaints procedures, they might be reported to the Financial Services Authority.


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