Consumer Complaints Are at an All-Time High. What Are You Doing About It?
Financial supervisory agencies are reporting record-high complaints—and that’s not including complaints on social media and review websites like Yelp and Google. These complaints serve as both a warning and an opportunity for financial institutions that have systems in place to monitor, report, and analyze complaints.
Consumer complaints to the Consumer Financial Protection Board (CFPB) reached a record high in 2020. December 2020 alone saw 48,386 complaints—up 260 percent from the previous December.
The Office of the Comptroller of the Currency (OCC) reports that complaints rose 20 percent between 2019 and 2020. Credit cards and checking account complaints made up the biggest share of complaints. Mortgage and consumer loan complaints also ticked up.
What Does the Increase in Complaints Mean for Your Institution?
The increase in complaints is not going unnoticed. In a recent blog, Acting CFPB Director Dave Uejio said that “Consumers and their experiences to be at the foundation of CFPB policymaking.” This includes consumer complaint reports, as Uejio made clear in his article, and the CFPB is staffing up.
Three key takeaways:
- Complaints are the CFPB’s “lifeblood.” Consumers may feel like their complaints disappear into a black box, but the CFPB says it takes them extremely seriously. Uejio said that one of his top priorities is ensuring “consumers who submit complaints to us get the response and the relief they deserve. Consumer complaints are our lifeblood; our direct connection to consumers in distress, and they are at an all-time high right now…It is the Bureau’s expectation that companies provide substantive responses that address the issues consumers describe in their complaints.”
- CFPB will be looking at racial disparity & complaint response. Uejio also reiterated that racial equity is a high priority for the Bureau. Complaints will be viewed through a lens of potential discrimination, with Uejio noting some consumer advocates have found unacceptable disparities in complaint responses in minority communities. The CFPB’s Division of Consumer Education and External Affairs (CEEA) will be preparing and publishing a report highlighting companies that have performed poorly in this area, and the senior leadership of such companies will be hearing from the CFPB.
- The CFPB is hiring lawyers. In February Uejio published a blog titled Calling attorneys interested in joining the CFPB. In it, he said the CFPB is recruiting attorneys at all levels to help fulfill the Bureau’s mission with “vigorous oversight of all applicable Federal laws and the fullest utilization of our legal authorities.”
Resources for Improving Complaint Management
Complaint management is a requirement of every compliance management system. If your institution isn’t confident in its ability to identify and analyze complaints, now is the time to update your complaint management program. Successful complaint management processes are centralized and organized and work to protect your institution. Haphazard programs lacking oversight are a serious compliance risk.
If your complaint management program needs improving, these resources can help get you started:
If you’re a Ncomply customer, you already have the tools you need to elevate your complaint management efforts thanks to the solution’s built-in and centralized complaint management function. Contact your customer service representative to find out how to put it to use.
For more insight into complaint management, view our webinar Managing Complaints to Achieve Better Results.