The Financial Conduct Authority (FCA) has for the first time distinguished between advice and guidance in the way it records complaints, in new rules out today.
The regulator split the categories with which it captures and files its complaints data from 'misleading advice/guidance', 'arranging', and 'inappropriate sales technique' to 'unsuitable advice' and 'unclear guidance/arrangement'.
This means it will have a clearer idea of how many complaints were made specifically about financial advice, and how many were about guidance, the regulator said in a statement on 23 July.
The changes followed a thematic review of how firms handle complaints which, though identifying good practices, also found a number of problems.
It identified inconsistencies in the amounts of redress offered, particularly for distress and inconvenience.
For instance the government set up a free at-retirement guidance service for all retirees this year following its pension freedom reforms, which could have skewed complaints figures under the old rules.
The regulator also expects to receive more complaints under the new rules, as it has made reporting mandatory for all consumer gripes, not just those exceeding its previous one day limit.
Three-day rule
Previously firms had to attempt to resolve a complaint within one day but this has now been extended to three days.
The regulator said this was to allow firms more time to resolve complaints less formally.
It said it expects fewer consumers having to take their complaints further as a result of the move.
If a complaint is resolved during this three day period, firms will be required to send their customers a simpler, template message informing them of their right to take their complaint to the Financial Ombudsman Service, it said.
The FCA also confirmed the removal of a rule requiring firms to handle complaints within one day but has made it mandatory for all complaints to be reported to the regulator.
More data
In addition to making its data clearer and more detailed, the regulator will change its biannual complaints data release.
It will add additional context, making it more informative and allowing consumers to better compare firms, it said.
The FCA will also ban the use of premium rates for telephone calls made to ask for assistance or to complain.
Christopher Woolard, strategy and competition director at the FCA said: "Our rules will help deliver the quicker, easier and fairer resolution to complaints that consumers want. Getting this right is also vital for firms.
"A properly resolved complaint can keep a customer happy, and protect the firm's reputation. But, more than that, effective complaints handling systems can act as an early warning system for firms."
Further Reading:
MMR review: FCA flags advice risk in overly rigid use of rules
