FCA seeks ban on premium rate calls for bank and insurance customers

City watchdog also calls for changes in the way complaints are reported

Banks and insurers are to be banned from making their customers calls premium rate telephone numbers as part of a series of proposals from the Financial Conduct Authority (FCA), which has also suggested removing the eight-week wait before a customer can take a complaint to the Financial Ombudsman Service.

The city watchdog said the use of 0845 and 0870 numbers should be replaced by normal geographical numbers that are cheaper to call, particularly for customers who use mobile phones. It has launched a consultation on the subject and indicated the proposal should be adopted by the summer.

The move will apply to all providers of financial services.

At the same time the FCA wants to change the way providers report customer complaints. Currently, banks and other providers that resolve simple complaints within one working day are not required to log those complaints with the watchdog, or to write to the customer.

The FCA has proposed extending the cut-off from one day to three, but wants all complaints logged and included in reports to it. The proposals follow a FCA thematic review on complaint handing.

Christopher Woolard, director of policy, risk and research, said: “Consumers want a simple way to complain that does not leave them out of pocket. And they want to be assured that their concerns will be dealt with fairly and quickly. These proposed reforms will further improve the system, making it less bureaucratic for firms, easier for consumers and will provide us with improved intelligence on complaints.”

In addition, complainants will be able to refer all cases to the ombudsman service immediately after receiving the firm’s response – doing away with the current eight-week wait. Firms will also have to inform customers, in writing, that they are able to take their complaint to the ombudsman service if they are dissatisfied with the resolution.

Richard Lloyd, Which? executive director, welcomed the news.

“Nobody should have to pay a premium to complain to their bank so this is another victory for the 90,000 people who supported our Costly Calls campaign,” he said.

“Some of our biggest banks have already dropped high rate phone numbers, and we urge all financial providers to do the right thing and cut off costly calls now rather than wait for any new rules to take effect.”

The consultation will run until March, and agreed changes should be enacted by summer 2015.


Miles Brignall

The GuardianTramp

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