Banks' complaints data show customers taken for granted

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Their individual data for complaints have been published in parallel with the Financial Ombudsman Service's (FOS) own data on the number of complaints it receives, yet the figures from banks reveal that the scale of complaints is much bigger than that indicated by the FOS.

Receiving the highest number of complaints - and not for the first time - were Barclays, who clocked in 449,911 complaints for the six months between January and June 2017. By contrast, Lloyds Bank weren't too far behind at a grand total of 325,187.

Yet while some might be tempted to blame such rises on PPI claims, many of the banks have seen increases even when PPI-related gripes are taken out of the picture, suggesting that the UK's biggest banks are increasingly taking their customers for granted.

PPI claims again

What's interesting about the complaints figures from the banks themselves is that they reveal the true scale of the problems customers have with them, in comparison to the FOS's figures.

For example, the data from the FOS - which reflects the complaints made directly to the Service - put complaints against Barclays at 15,405.

However, as the table below reveals, the complaints that Barclays received directly from customers in the first half of the year stood at a total of 449,911, indicating that around only 3.4% of complaints actually go as far as the Ombudsman.

Source: UK high street banks

That said, Barclays aren't the worst offending bank when Lloyds Bank are counted with the rest of the Lloyds Banking Group, rather than as a separate entity.

Such combining might seem like an unfair thing to do, yet Barclays essentially operates as a UK-wide group, whereas the Lloyds Banking Group's UK activities are split more equally between a number of individual banks, such as Lloyds Bank and Bank of Scotland.

Accordingly, taking these two subsidiaries as a whole, they attracted 607,706 complaints in total in the first half of the year. This includes a total of 301,276 PPI complaints, and it makes up about 2.8% of the 22 million current account customers the group have throughout the UK.

As such, the data seem to confirm Lloyds' reputation as the bank hit most severely by the PPI mis-selling scandal, especially when taken with the recent news that they put aside an extra £1 billion in the first half of this year to cover PPI compensation.

Personal banking and credit cards

Yet the complaints data released by the individual banks don't relate only to PPI complaints, since they also relate to personal banking and credit cards, home finance, and investments.

Taking personal banking and credit card figures separately - since this covers the area in which most customers will have contact with their bank - the following picture emerges:

Source: UK high street banks/FCA

Once again, Barclays attracted the largest number of complaints related specifically to personal banking and credit cards, with their figure having risen by 0.2% compared to the previous six-month period.

Yet what's perhaps more interesting is that NatWest and the Royal Bank of Scotland - both RBS banks - have witnessed quite staggering increases in their complaints for personal banking issues, at 7.4% and 8.8% respectively.

And when it comes to this particular category of complaint, neither bank can blame the rise on the legacy of PPI. Instead, they should look closely at their own practices and how they're dealing with customers.

Taken for granted?

The question is, however, what should customers do if they want to avoid being poorly served by their bank?

Well, the obvious answer is to vote with their feet and switch bank, although what's odd is that the above rises in complaint figures has taken place at the same time that switching figures have actually fallen by as much as 10.6%.

In other words, it's possible that part of the reason for why personal banking complaints have increased is not simply that certain banks are having issues, but that they're taking their customers more for granted, since these customers are switching less.

In this case, customers really should consider jumping ship when they feel as though their bank isn't doing good enough, and while the above tables would suggest that there are few alternatives, at least a couple of banks are reducing their personal banking complaints.

These are Lloyds and Metro Bank, who are managing to gradually improve things for their account holders, and who are showing that at least not every bank on the high street is taking their customers for granted.