Banks and financial services: How to find the best and deal with the worst
By Kate Saines
Receiving excellent customer service from our banks and building societies is surely the very least we should expect in a world where the customer is always right.
But it would appear being the epitome of trust and reliability is not an easy task for our financial services providers at the moment.
In fact, evidence would suggest that the bigger names in the banking industry are falling short of expectations while the smaller companies and those whose main business is in selling groceries are coming much higher in the customer satisfaction stakes.
A report in The Sun on Saturday May 28th contained a very rare item indeed, an admission of failure from a senior banker. Barclays Retail Chief, Antony Jenkins said: “The industry’s reputation is not high for factors you are familiar with, and it’s something we think about a great deal. So we have to change the way we deal with customers. We have to change the business so it serves customers. It should always have been the case.”
Read on for an insight into who is providing good customer service, which firms are providing the bad and tips to ensure things don't get ugly.
The Good
If you want fantastic service from a financial products provider, it seems you need look no further than your local supermarket.
In a survey of 12,000 people retailers such as Sainsbury's and Tesco were named frequently as the most trusted and praiseworthy service providers in the finance world.
Meanwhile, Marks & Spencer and John Lewis are winning similar plaudits for their financial products.
The Moneywise Great British Customer Service Survey names John Lewis, M&S Money and Tesco among the six most trusted credit card providers.
Sainsbury's and Tesco were among the most trusted loan providers and won praise for having the best credit card call centre service.
Marks & Spencer is also hailed for its ISAs, with customers praising its consistency of rates and for being the most trusted cash ISA provider.
So why are they so successful? It's all down to the fact they have already gained customers' trust through their main business.
Johanna Gornitzki, editor of Moneywise, said: "Tesco is a good example of a retail brand that has successfully exploited high levels of trust among its customers to make a real impact across the financial services market."
A name which also appears frequently on Moneywise's list is internet bank, Smile. Customers flagged it up as among the most trusted current account, online credit card and best call centre.
And First Direct is another name which appears in a number of categories.
These smaller banks are no strangers to the top of the customer service charts, as both were highlighted by Which? members for their customer service last year in the People's Choice poll.
According to Which? excellent customer service is the key to keeping customers happy and First Direct came top for satisfaction in three departments – current accounts, savings and mortgages.
One Account and Smile also scored highly.
The Bad
While the smaller banks are getting the customers' vote, the bigger ones are falling short.
Peter Vicary-Smith of Which? said: "Whether it's a current account, mortgage, credit card or savings account, we consistently see the same names keeping their customers happy.
"Time and time again the big high street banks are found to be lacking when it comes to the good customer service."
The People's Choice poll put Bank of Scotland and Halifax at the bottom of the table, with Lloyds TSB and Cheltenham and Gloucester 'not scoring much better', according to Which?. Meanwhile, Santander and Northern Rock also scored poorly.
It's not just Which? members noticing the downfall of the big banks, as evidence has emerged elsewhere.
Research carried out for the Moneywise Customer Service Awards revealed Santander had a mountain to climb when it came to customer service.
It was rated worst for customer service, for the second year running. Barclays and Halifax came second and third.
Santander recently amalgamated its various businesses under one brand and is constantly offering tempting incentives to customers to switch to its brand - £25 worth of Amazon vouchers plus £100 cashback is the latest offer.
It also prides itself on offering existing customers perks when they take out other products.
Yet, the customers themselves do not seem impressed.
Johanna Gornitzki of Moneywise said the most common complaints it had received included long queues in branches, unhelpful call centres and untrained staff.
She added: "One disgruntled survey respondent said 'a visit to a large branch in Swansea to open a savings account was a nightmare and a waste of time, due to terrible service. I have decided not to open an account based on the experience'.
"Santander has apologised to those who have complained but it needs to show tangible proof that it is serious about customer service and making some real and fundamental changes.
"Until then, complaints will keep flooding in."
Read more: A guide to inflation-linked savings accounts
The Ugly
Unfortunately, we live in an age where banks do not seem to be delivering. And there have been several high profile cases recently where banks have acted so badly they have lost their customers' trust.
Need we mention the fact the customers, in their guise as taxpayers, have bailed out several high street banks in dire financial straits.
And then there are the mis-selling scandals, the hefty charges we have been saddled with and plenty more where that came from.
Just last week the Financial Services Authority (FSA) fined the Bank of Scotland £3.5million for the mishandling of complaints about sales of various investment plans.
An investigation found 45 per cent of complaints it rejected should actually have been upheld.
Worse still, it emerged the majority of the complaints were from older customers who had little or no experience of the products.
Peter Vicary-Smith, chief executive of Which?, summed up the thoughts of many: "Not only was the Bank of Scotland mis-selling investment products to vulnerable consumers then unfairly rejecting their complaints, it was doing so whilst being bailed out by the tax payer."
He called for a fundamental overhaul of the way the banking industry deals with complaints.
How to get good customer service
As customers we have a very powerful tool we can use if we are not happy with the customer service we are receiving – the power to switch to another provider.
Peter Vicary-Smith said: "People who are unhappy with their bank must vote with their feet and move to a better financial provider."
Of course this is easier said than done because switching, especially if we have lots of products with one bank, could be an administrative nightmare.
But it could be well worth the effort if it means achieving the financial summit of top class customer service.
If you are not happy with the service you have been receiving, have run into a problem with your bank or think you have been treated unfairly then you also have grounds to make a complaint.
The first step in this process, says the Financial Ombudsman Service (Fos), is to speak to the person who you originally dealt with, if possible.
If they cannot help, say you want to take matters further. Make sure you get a copy of the organisation's complaints handling procedure.
Keep a note of all phone conversations, their time and date and who you spoke to. Ideally make the complaint in writing. But if you prefer using the phone, it might be a good idea to back up the call with a written complaint.
The Fos advises you write "complaint" at the top of your letter and include important details like your account number, customer number or policy reference. Also, make sure you keep copies of letters.
The organisation you are complaining about has, by law, eight weeks to deal with your complaint before the ombudsman can step in. So it's important to be patient.
If you have no joy after this time, you can take your complaint to the Ombudsman. If the Fos rejects your complaint, don't worry as you have the right to appeal.
Organisations such as Citizens Advice also provide help to people who feel they have been treated unfairly by companies like banks. They may be able to help you if you are not confident about taking your complaint further.
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