Simon Read: Banks are running out of excuses for their massive complaints

The Financial Services Authority put Britain's high street banks and insurers back in the dock this week by revealing that complaints against them grew by 24 per cent in the last six months of 2011.

There was an all-time high of 2.256 million complaints against financial firms in the second-half of the year. That's roughly one complainant per 10 households or, to put it another way, it means at least a couple of your neighbours – if not you – were forced to complain about the products of service of their bank, building society or insurance company.

Another way to look at the figures is to break them down into different time scales. The old back of an envelope calculations show that there were an average of 376,000 complaints in each month between July and December.

On a weekly basis there were 86,769 complaints, which means for each working day, there were 17,354. Assuming an eight-hour day, it means that fed-up customers of banks and other finance firms complained at an average rate of 2,169 per hour.

That means there were a shocking 36 complaints a minute, or one every second and two-thirds. To be fair to the finance firms, more than half of the complaints were about payment protection insurance, which means the cock-ups didn't occur last year but, probably many years previously.

That's because most of the PPI complaints will have dated from 2008 or before, which was when the commission-hungry banks were busiest foisting the expensive and often-useless cover on unwary people taking out loans or credit.

But even stripping out the PPI effect – which accounts for 56 per cent of the total complaints, the figures are still appalling, despite banks' attempts to suggest they've made massive improvements.

There has been an improvement in banking complaints, if you look just at the number received. It fell by 122,000 over the same six month period in 2010. That suggests the banks have started to get their collective acts together to deal with their poor levels of service and rip-off products.

But they have gone nowhere near far enough, given that there were still 778,000 banking complaints between July and December last year. That shockingly high total relates only to new complaints about such things as shoddy service, misleading charges, or bad advice.

And it shows that the banks have got an awfully long way to go before we can even begin to think about praising them for decent customer service or complaints handling.

Offering what looks like a great deal but including an introductory bonus is a weasely trick that I've long criticised banks and building societies for. It means they can get their dodgy deals to the top of the best buy tables and attract people excited by market-leading interest rates.

The problem with all introductory offers is that, once they're withdrawn, the savings account, credit card or mortgage almost always end up being market-trailing. They leave the people who've been tricked into taking them out stuck in an account that pays paltry interest rates, or has more expensive charges than similar deals.

So I'm pleased to report that more and more financial firms seem to have been listening to my argument and realising that they're damaging themselves long-term by continuing to offer these lamentable bonuses.

Last week, the UK boss of credit card firm Capital One assured me that they had totally withdrawn from the questionable 0 per cent credit card deals, that often leave people deeper than debt than if they'd never taken them out in the first place.

This week the Kent Reliance – the former building society now owned by OneSavings Bank – launched some new savings accounts that don't offer introductory bonuses. Even better, the firm has agreed not to slash interest rates on accounts opened a year ago, which included introductory rates that are just about to end.

The firm was one of the worst exponents of using introductory bonus trickery. For instance its cash ISAs launched last March paid 2.85 per cent. But that included an introductory bonus of 2.5 per cent, meaning anyone who didn't switch as soon as the bonus rate finished would end up with a paltry 0.35 per cent on their savings.

Under the new policy they will receive 2.5 per cent, the same that new customers with the same balance will receive. This is the only fair way of dealing with people, I believe, and am happy to praise new Kent Reliance boss Andy Golding for changing the way the firm runs its business for the better.

But I'll be much happier if other finance firms follow suit and stop the misleading starter bonuses. We deserve accounts that are clear and easy to understand.

s.read@independent.co.uk