First every bank complaint figures published ahead of new rules as survey shows financial sector is amongst worst for customer service

News - Banking

Written by Ray Clancy

Monday, 26 April 2010 12:00

The Royal Bank of Scotland gets more than 1,600 complaints a day and along with its subsidiary NatWest it received 302,371 complaints in six months last year, according to the first such figures to be published.

RBS is the first bank to publish data of customer complaints, something all banks will have to do from August this year under new Financial Services Authority rules. The vast majority of complaints concerned problems with current accounts, credit cards as well as payment protection insurance.

Data released by the bank, which is 84% owned by UK taxpayers after being bailed out at the height of the financial crisis, also showed it admitted making a mistake to eight out of ten customers who complained about a banking problem.

RBS claims the volume of new complaints received was particularly high in the last six months of last year because of the result of a Supreme Court decision on unfair overdraft charges. This meant all cases put on hold over the previous two years suddenly had to be dealt with.

But Marc Gander, from the campaigning Consumer Action Group, said such a high level of complaints is not acceptable. ‘It’s not acceptable that so many people should have so many problems with their bank. Of course, the real tester will be when we see the data from the other banks and we get a full picture of precisely how bad the problems are,’ he added.

The figures were published as a new survey revealed that banks and building societies are amongst the worst service providers along with estate agents and energy firms.

‘It is a shame to see financial service providers, like banks and building societies, fairing so poorly when it comes to service. While banks and building societies have taken a beating due to the economic downturn this isn’t any excuse for poor service,’ said Kevin Mountford, head of banking at moneysupermarket.com which carried out the research.

‘Providing a top quality service to customers is something far too many providers fail to see the benefit of. Yet a reputation for bad service can be difficult to shake off, and many more consumers are feeling empowered enough to switch providers if they have a bad experience,’ he explained.

‘The main problem stems from the fact that the industry has gone down the automated route and as a result has lost some personality. However to bring service back in play could see an increase in cost and indirectly consumers may suffer as a result of reduced rates,’ he added.

Following the launch of Metro Bank, this year is set to see more new entrants in the banking sector such as Tesco Bank and Virgin Money, and this could prompt some of the more established brands to raise their game.

‘The introduction of Metro Bank to the high street, a provider we expect to compete strongly on quality service, may force some of the old guard into a rethink,’ said Mountford.