Industry updates

Each month we send a market update to key figures in the industry.

We cover the most important issues and give our honest opinion about the current hot topics. Catch up with our views and reviews by looking at the archive below.

If you would like to be added to the distribution list, please use the contact us page.

Time to end “tick box” complaint handling processes

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.

  • Senior Manager & Certification Regime comes of age – what next?

    It is just over 2 years since the FCA Senior Manager & Certification Regime [SM&CR] was implemented for banks and deposit takers. Since then, the regulator has continued to embed cultural changes and strengthen market accountability with the objective of minimising consumer harm. There were, therefore, no surprises that the recently issued policy statement extending […]

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  • Behaviour and Culture of the Irish Retail Banks – a new Individual Accountability Framework

    The Independent recently interviewed the Central Bank of Irelands’ Director General (Financial Conduct), Derville Rowland. The issue of culture in Irish banking institutions was considered at length and Rowland indicated that a culture report would be produced for the Minister shortly – it has since been issued. The report focusses on the behaviour of the […]

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  • Artificial intelligence [AI] in financial services

    The FCA has announced details of its successful and catchily named ‘fourth cohort candidates’ in its sandbox. This allows firms to test innovative products in a live environment, while ensuring appropriate protections are in place. The 29 successful firms include businesses ‘testing’ automated solutions across a range of product areas including automated advice and decisioning. […]

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  • Mortgage Arrears – time to focus on policies?

    The recent UK Finance arrears and possessions conference highlighted several action points for lenders and servicers. The underlying message, which mirrors current regulator themes is clear; organisations should use the current benign arrears environment to “weatherproof” policies and procedures. We were not surprised to hear the renewed focus. Although current arrears numbers are low and […]

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