Record number complain about banks

JUST over three million complaints against banks and insurance companies were lodged by customers in the second half of last year.

This amounts to almost 17,000 a day and is an increase of almost a million on the previous six months.

The huge rise was triggered by new rules under which financial firms, including credit card companies, have to register every complaint.

Previously they did not have to report complaints to the City watchdog if they were dealt with by the next day. This makes it hard to compare the figures with previous periods.

The Financial Conduct Authority figures show payment protection insurance remains the most complained about product, with 895,000 complaints in the second half of last year. This is followed by current accounts, with 514,000 complaints, and credit cards, with 313,000.

Barclays was the single most unpopular bank, attracting 438,237 complaints. It was followed by Lloyds, with 297,148, and Bank of Scotland – part of the same group – with 267,237.

But the Queen’s bank Coutts has the worst track record relative to its small size, with around 15 complaints per 1,000 customers.

Barclays received nearly seven complaints per 1,000 customers.

Four in ten complaints (1.2million) were about poor customer service and administration, and 39 per cent about advice and sales.

A total of £1.9billion was paid out in compensation in the second half of last year, compared with £1.96billion in the first half.

James Daley, of the consumer group Fairer Finance, said: ‘These figures show there are still serious problems in the financial services sector and a lot of very unhappy customers.’

Banks have said a huge number of the complaints are baseless and have been driven by ‘no win, no fee’ claims management firms.

The FCA estimated that if all complaints had been included previously, the total fell 14 per cent between the first and second half of last year.

Barclays said: ‘We’ve been working hard to get our banking complaints down and are no longer the most complained about banking group, but we know we still have more to do.’