Banks urged to do more to resolve customer complaints

Banks and other providers of financial services should do more to resolve customer complaints before they have to be taken to the Financial Services and Pensions Ombudsman, an Oireachtas committee has been told.

The ombudsman, Liam Sloyan, told members of the Joint Committee on Public Petitions that the number of complaints received by his office last year was up 29 per cent to 6,182 and that staffing is currently in the process of being increased by more than half in order to cope with the added workload.

Deputy ombudsman MaryRose McGovern told the committee there was no reason that number of complaints should need to be referred to the ombudsman’s office but that initial data for the current year pointed towards a similar number of complaints being received in 2024.

Mr Sloyan said more than half of the complaints are in relation to banking, with about a quarter originating from customers of insurance companies, and though most are ultimately resolved through mediation, the figures “should be cause for reflection among providers”.

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“I would encourage providers to reflect on the nature of the complaints and their failure to resolve some of these complaints through internal procedures,” he said.

As it was, he said 5,184 of the complaints made to the ombudsman’s office had been closed within a year with resolutions taking on average 8½ months.

Mr Sloyan said he believed the closure rates and time frames involved were reasonable given the workload involved but, he said he was “very conscious of the difficult situations people can be in when they are making these complaints”.

The office has the power to award compensation of up to €500,000 where it finds people have been unfairly treated and order unlimited sums in order to rectify situations. In 2023, Mr Sloyan said, the total value of the resolutions it had overseen was about €4.7 million.

The committee heard the number of complaints currently being made with regard to financial services providers may well be restricted by the relatively low level of public awareness of the ombudsman but that publicising this remains a priority for the organisation.

Mortgage products remained a significant source of complaints during 2023 and more than 107 were received in relation to tracker mortgages with most concerning an alleged failure by banks to offer a tracker product that covered the full term of the loan. In almost every instance – 103 – the complaints were rejected, the committee heard.

Of the four substantially upheld, directions worth a total of €38,000 were made.

Figures previously published by the ombudsman show that of another 117 complaints initially made in relation to tracker mortgages, but in which no binding decision was made, 33 resulted in settlements while 42 were withdrawn.

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