Banks came under renewed fire yesterday after the City watchdog said they were responsible for nearly 1 million complaints in just six months.
The Financial Services Authority's director of retail, Dan Waters, demanded swift action to cut the number of unhappy customers, saying: "We are not happy with the volume of complaints. There should be less. Making sure firms handle complaints properly is a priority for us.
"You would have thought that in any well-run business if things are not going right management would want to take action to address it."
In the second half of 2008 banks generated 870,124 complaints, the highest level since the 1.35 million filed by customers in the first half of 2007, at the height of the controversy over alleged unfair overdraft charges. In total they were responsible for more than half of the 1.48 million complaints filed across the entire financial services industry during the period, including traditionally contentious areas such as car and life insurance.
The figures were published on the same day that the CBI director general, Richard Lambert, said that returning the flow of credit to private firms and getting banks off the taxpayers' back are more important than bankers' pay.
"There are only two questions that really matter in the banking market today, and they are not about bankers' pay and rations, or the social value of credit derivatives," he said.
"Instead, the right question to ask is, how do we get credit flowing properly through to the private sector, especially to small and medium-sized enterprises? And what kind of shock absorbers do the banks need to have in place so that they can get off the taxpayers' back?"
A survey from new business.co.uk found that more than 30 per cent of small and medium-sized business owners have rated the helpfulness of their bank in the current economic climate as "atrocious".
The FSA is currently consulting on measures that will see the complaints data of individual banks published against each other to allow customers to compare and contrast their performance and discover which generate the most problems. So far it has only published statistics across the entire industry.
However, while the consumer lobby is strongly in support of the measure, banks are resisting it, arguing that the data could be open to misinterpretation because banks with big market shares in particular product areas would inevitably draw more complaints than smaller ones.
Mr Waters refused to be drawn on whether the plan would be adopted while the consultation process is ongoing. However, he said: "We wouldn't have proposed it if we didn't think it would be a good idea."
Banks that fail to take action are likely to face tough action, including what could be heavy fines. Consumer groups immediately seized on the figures, saying they were evidence of an industry that continued to only pay lip service to treating consumers properly.
The Which? personal finance campaigner Phil Jones said: "It's a poor reflection on the industry that there are so many unhappy customers out there. Financial firms simply aren't treating consumers well enough, and things must change if the industry is to rebuild its reputation."
The British Bankers' Association argued that the "proportion of reportable complaints is still very small at 3.5 per 1,000 products held".
It added: "The vast majority of bank customers have no problems with their accounts and the services they use. Millions of transactions for millions of customers go through the banking system every day and, while it is inevitable that occasionally things go wrong, banks are not complacent and are continually working to improve service and efficiency."Reuse content