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Financial complaints rise by 20,000 in six months

Customer complaints about almost every financial product, from current accounts to credit cards and PPI, have surged, official figures show.

The financial ombudsman took on 170,083 new cases from disgruntled consumers in the first half of the year, up 13 per cent from 149,864 in the second half of last year.

The independent disputes arbitrator deals with complaints that are rejected by banks, insurance companies and investment firms.

On average the ombudsman found in favour of the customer in 36 per cent of cases, meaning these customers had been unfairly rejected by the company in the first place.

Customers complained about a range of products, with PPI being the most unpopular and cred cards also featuring

Payment protection insurance continued to be by far the most complained about product. The number of complaints jumped 14 per cent from 78,375 to 89,513.

The increase was spurred by the complaints deadline – August 2019 – which was announced by the Financial Conduct Authority earlier this year.

This has prompted no-win no-fee claims firms to exert even more pressure on customers to lodge a claim, bombarding them with text messages and cold calls.

But complaints about banking and credit – which includes credit cards, current accounts and overdrafts – also rose by 12.5 per cent from 41,484 to 46,656.

The biggest increase in this category was complaints about current accounts which jumped 35 per cent from 7,976 to 10,799.

The ombudsman said it had seen a particularly big rise in complaints about administrative errors and poor customer service.

It dealt with a big rise of complaints about Barclays, NatWest, Santander, HSBC, Bank of Scotland and Lloyds.

Overall, Bank of Scotland had the most complaints – at 20,541. It was followed by Lloyds Bank, part of the same group, at 18,068, and Barclays, with 15,405.

Santander, along with HSBC, Lloyds Bank, NatWest and Barclays was complained about, with Bank of Scotland topping the list

Santander, along with HSBC, Lloyds Bank, NatWest and Barclays was complained about, with Bank of Scotland topping the list

Caroline Wayman, chief ombudsman and chief executive of the Financial Ombudsman Service, said: ‘We’ve seen more complaints about most types of financial products in the first half of 2017.’

One consumer campaigner said the ombudsman’s figures show there are still ‘endemic problems with the way banks and insurers treat their customers’.

James Daley, founder of Fairer Finance, said the increase may have been driven in part by the actions of claims firms.

But he added: ‘It’s important to remember these are people who have already gone to the length of complaining to their bank and insurer, haven’t got the right response and been upset enough to take it even further.

‘It is not a good sign that the number of claims dealt with by the ombudsman is increasing. This indicates a growing dissatisfaction with banks and insurers. A decade on from the financial crisis it seems the cultural change the industry promised has not come to light.’