Financial services sector focussed on the ‘putting right’

Media release: Financial services sector focussed on the ‘putting right’ says FSCL CEO

Financial services providers seem to be doing a good job at resolving customer complaints says Susan Taylor, the Chief Executive Officer of dispute resolution scheme Financial Service Complaints Limited (FSCL).

FSCL’s latest annual results show an 85% increase in enquiries and complaints received by FSCL compared to the same period last year (up to over 3,000), but only a 24% increase in the complaints the scheme had to formally investigate.

“These results suggest that while consumers are becoming more empowered to seek help when there are problems, our participants are doing a good job at putting things right,” says Ms Taylor.

Of the 202 cases FSCL did investigate, over half (109) were settled either by the participant soon after the investigation started, though conciliation with a FSCL staff member, or by a recommendation suggesting that the participant pay compensation. Only four cases required a formal ruling by FSCL.

“In all these cases the complainant would have walked away with compensation or some other remedial action such as a loan restructure or an apology that has satisfied their complaint.”

Ms Taylor says a total of $786,372 was paid out in compensation during 2013/14, up from $514,785.62 last year.
For the first time, complaints about consumer credit made up the greatest share of cases FSCL investigated (44 of 202 complaints), followed closely by complaints about travel insurance (42).

Ms Taylor said that despite the increase in workload, continued growth in participant numbers and efficiencies meant it could reduce participants’ annual fees for a second year running by 12.5% for 2014/15.

FSCL will release its full annual report for the 2013/14 financial year in October.

Background
FSCL is an independent not-for-profit external dispute resolution scheme approved by the Minister for Consumer Affairs under the Financial Service Providers (Registration and Dispute Resolution) Act 2008.

It was the first scheme to be approved and has been designed for and in consultation with the financial services industry on the principles of efficiency and effectiveness. It is governed by an independent Board with equal consumer and industry representatives, and an independent Chair.

FSCL provides dispute resolution services to participating financial service providers and their clients. The FSCL process focuses on resolving complaints through conciliation and assisted negotiation and is also able to make formal determinations which are binding on financial service providers. The FSCL process is free to consumers. For more information on FSCL visit www.fscl.org.nz

The other dispute resolution schemes in the financial services industry are the Banking Ombudsman, the Insurance and Savings Ombudsman and the Government’s reserve scheme, Financial Disputes Resolution. For more information about the financial services disputes resolution regime visit www.consumeraffairs.govt.nz/for-consumers/how-to-complain/financial-service-providers-disputes- resolution

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