Ombudsman worried by banks level of service

By Vera von Lieres - Business Report, The Star, 12 December 2002

One in six people complained about their bank over the past year, Neville Melville said yesterday, raising deep concern about the level of client service provided by the country's financial institutions.

Melville was seriously worried by the perceived lack of performance on complaint handling.

Our financial services industry in one of the most sophisticated worldwide, particularly in terms of systems, infrastructure and the like. But it lags behind when it comes to meeting peoples' expectations.

"While there is no doubt that the banking sector's client service standards have progressed in leaps and bounds over the past few years, it is troubling to see such large percentages still reporting disappointment."

His comments follow a survey by independent research company Markinor, the second this year to assess how the country's for big banks-Absa, Nedcor, First National Bank and Standard Bank - responded to customer complaints.

The research revealed that the two top causes of complaints were errors and poor communication standards, with clients most annoyed by the way a complaint was dealt with.

Of the 1 600 people interviewed, 46 percent ranked complaint handling within their bank poor or fair-a 4 percent rise on last year.

The remaining 54 percent were satisfied.

Of the big four banks, Absa was most positively viewed in the various categories surveyed.

These include how to most easily find the correct person to speak to and resolving a matter, while the other three banks were "much of a muchness".

Melville pointed out that many of the complaints referred to his office, could have been avoided if bank staff had offered the correct explanation and support in the first place. The situation could be dramatically improved if every bank genuinely adopted "the customer comes first approach" by treating their account holders as individuals.

A significant percentage of people surveyed did not change banks despite dissatisfied because they felt trapped by fear of losing their credit record or by having a large overdraft, for example.

Improved levels of service would be achieved through more focused personnel training and consumer marketing initiatives, aimed at increasing awareness of how complaints could be handled.

Another cause for concern was the fact that only one in five people were aware of the existence of the Code of Banking Practice.

"The code provides valuable safeguards for customers. However, customers obviously derive no benefit from these safeguards if they are unaware of their existence!".

It was clear that the four large banks were not doing enough to educate clients about their rights relating to he code, Melville added.