Complaints about financial services remain at historically high levels, according to new annual statistics from Financial Services Complaints Limited, and of the cases that were formally investigated, complaints about financial advisers made up the largest proportion.
The financial ombudsman service says that for the year ending 30 June, FSCL received 1,469 complaints, up from 1,426 in the previous year, and double the amount recorded five years ago. It says the levels reflects ongoing financial pressure on small businesses and households.
Financial Ombudsman, Susan Taylor says the service is not yet seeing signs of complaints reducing since increasing rapidly two years ago in the wake of Covid.
“What’s changed is the spread. Complaints are now more evenly distributed across a broader range of financial services, rather than being concentrated in just a few areas like non-bank lenders.”
FSCL says lenders accounted for the largest share of complaints at 38%, but many of these were resolved before escalating to a dispute needing formal investigation. Dispute numbers rose by 4% overall, with a noticeable shift in the types of issues and sectors involved.
It says of the 366 cases that were formally investigated “…complaints about financial advisers — including mortgage and insurance brokers, as well as wealth advisers — made up the largest proportion at 23%, followed by complaints about lenders at 20%, and insurers at 17%.”
FSCL says one emerging trend is a rise in complaints from small businesses, especially about loans and insurance products.
“This likely reflects the tough trading environment many small business owners are facing,” says Taylor. “They’re under pressure — and we’re seeing that come through in the disputes they bring to us.”
She adds that the service is there to help when things go wrong “… but also to feed insights back into the system so things go better next time.”