Internet banking complaints to ombud increase steadily

Almost half of all complaints to the ombud in 2016 were related to ATM and internet banking and consumers expected too much, writes

Last year, the Ombudsman for Banking Service (OBS) received 205 more internet banking complaints than in the previous year. Most of these complaints related to cellphone or app banking, which increased by seven percent. This is indicative of a need for greater security, the OBS’s annual report for 2016 says.

Ombudsman Clive Pillay reports that only 22 percent of internet banking complaints were found in favour of the consumer, “which underlines the ongoing need for consumer education”, he says. “Our demographic statistics reveal that most of those who fall prey to technology-based scams are consumers older than 40. Those younger than 30 are generally tech savvy and less susceptible to suspicious practises.”

ATM- related complaints remained the biggest category of complaints, in spite of a drop in the number of these complaints (from 1 654 in 2015 to 1 268 last year). The ombudsman says he hopes that the decline in the number of ATM-related complaints is an indication that card users are becoming more vigilant when transacting in a public place.

“As with inter net complaints, most awards were made to the banks, as the consumer was found to be at fault, again reflecting a lack of awareness of the risks of sharing PINs or accepting help at a machine,” the annual report states.

There was a marked increase in credit card complaints, from 390 in 2015 to 505 in 2016.

“Some 36 percent of all credit card cases were charge-back disputes, where some element of fraud was suspected.”

Pillay says that more than half of all cases handled in 2016 were fraud-related complaints. “In these complaints, the complainant is overwhelmingly the victim of a scam. There is no maladministration on the part of the bank,” Pillay says.

Overall, the ombudsman’s office opened 5 219 cases during 2016 – a four percent increase on the previous year – and only 24 percent of complaints went the way of the consumer. The OBS’s annual report says his office recovered R15 million from the banks for consumers, which is 50 percent more than in 2015.

The banking ombudsman’s office closed 96 percent of cases within four months, which is a small increase (2.1 percent) on 2015, and the average number of days to close a file dropped from 61 to 52.