The FCA has recently published the findings of its review of complaint handling by non-deposit taking mortgage lenders and mortgage third party administrators. The results are far reaching and significantly relate to all regulated firms not just to the sectors initially investigated.

Overall, the results were positive, but there are areas where firms need to re-focus. The areas where immediate improvement is required, include;

1. Making more effective use of management information and root cause analysis (rather than just producing MI for MI sake)

2. Ending ‘tick box’ and inflexible complaint handling processes; the FCA believes this leads to poor consumer outcomes)

3. Learning from determinations by the Financial Ombudsman Service

In our experience, when carrying out business process reviews and third-party supplier oversight, missing links often occur between the collected data and the various implicated departments. Most complaints from customers cross different departments and business functions.

Communication is critical when considering complaints; Bill Gates once said, “Your most unhappy customers are your greatest source of learning”. We find the firms who successfully ‘learn’ from customer dissatisfaction manage to engage the whole business in improving the customer journey, generally resulting in positive customer outcomes. However, firms who treat complaint handling as a regulatory burden rarely benefit from the resource expenditure and put themselves at more risk from the regulator.

Achieving the correct organisational engagement requires positive leadership from senior management and boards. In our experience, it is only when positive complaint handling becomes part of the ‘DNA’ of a firm that the culture of the firm really changes, and it starts to learn and profit from complaints. The FCA findings should lead to a re-appraisal of complaint procedures and processes.

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