Tuesday, 28 October 2014
Lloyds Bank had 62,132 complaints referred to the Ombudsman in the first 6 months of 2014
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Giant state-backed banking group Lloyds was the most complained about financial institution in the first six months of the year, figures show.
Across its different brands, which include Halifax and Bank of Scotland, it attracted a third of the total complaints received by the financial ombudsman, which settles disputes between banks and their customers.
The ombudsman received 62,132 new complaints about Lloyds Banking Group between January 1 and June 30. The total across all institutions was 191,129.
Lloyds was followed by Barclays, which had 27,487 complaints. Royal Bank of Scotland, another state-backed giant, had 13,654 complaints passed to the ombudsman (see table below).
However, these three groups, which account for a large proportion of banking customers, saw overall complaint numbers decline from the previous six months.
Figures were lower than in the second half of last year due to a shrinking number of payment protection insurance (PPI) cases, the ombudsman said.
Complaints about PPI fell to 133,819 from 266,000but still accounted for seven out of 10 cases.
Outside of PPI, banking complaints rose 7pc overall and the ombudsman warned there are signs that banks and other firms were failing to handle complaints properly.
The proportion of cases where the ombudsman found in favour of the customer rose from 51pc to 57pc.
Among the worst offenders were the smaller lender MBNA, which lost 93pc of cases. HSBC lost 78pc, and Barclays and Lloyds Bank both lost 66pc.
Caroline Wayman, chief ombudsman, said: “We’re seeing more and more people turn to us in frustration where they feel their bank or insurer simply doesn’t understand or really care. And we’re hearing growing dissatisfaction from people about being processed industrially as a number rather than being listened to as an individual customer.
“By giving their customers more thoughtful, considerate and personal responses – clearly setting out the reasoning behind an individual decision – we know that businesses can help sort out problems earlier on, prevent complaints being escalated to the ombudsman and rebuild trust and confidence more generally.”
James Daley, director of consumer website Fairer Finance, said while banks had improved complaints handling procedures in the first few years after the financial crisis, those improvements seem to be stalling.
"If more than 50pc of complaints to the ombudsman are being upheld in favour of the customer, then quite simply banks are making the wrong decision when a customer first complains, more often than they're making the right one,” he said.
"Banks need to make every effort to sort out complaints at the very beginning of the process, and should be ready to give customers the benefit of the doubt more often – rather than forcing them to appeal to the ombudsman, which can drag out disputes for months on end."