Background
 

Under Section 15 of the Banking Code subscribers are required to handle customer complaints by following rules set out by the Financial Services Authority (FSA).

On the 1st November 2007 the FSA is changing its complaint handling rules. This changes the timescales for responding to a complaint.

This means that Banks and Building Societies who subscribe to the Banking Code must as a minimum comply with the FSA's new rules, for complaints that are not resolved by the close of the next business day.

The new Complaint Handling Rules
 

Under the FSA's new rules, Banking Code subscribers will:

·  On receipt of a complaint:

(1) send the complainant a prompt written acknowledgement providing early reassurance that it has received the complaint and is dealing with it; and

(2) ensure the complainant is kept informed thereafter of the progress of the measures being taken for the complaint's resolution.

·  By the end of eight weeks after receipt of the complaint, send the complainant:

(1) a final response; or

(2) a written response which:

(a) explains why it is not in a position to make a final response and indicates when it expects to be able to provide one;

(b) informs the complainant that he may now refer the complaint to the Financial Ombudsman Service; and

(c) encloses a copy of the Financial Ombudsman Service standard explanatory leaflet.

What does this mean for customers?
 

Under the Banking Code all subscribers are required to act fairly and reasonably in their dealings with customers. This will continue to be the case under the FSA's new rules.

Subscribers are still required to follow Sections 15.1, 15.2 and 15.6 of the Code which inform customers of the ways in which a complaint can be made.

Subscribers can also choose to maintain the time limits set out under Sections 15.3 and 15.4 of the Code as these demonstrate best practice beyond that required under the FSA's new rules.

Banks and Building Societies will ensure that their relevant customer communications are updated as required by the 1st November 2007 to reflect their processes for handling customer complaints.

From 1st March 2008 the new Banking Code will mirror the FSA's new complaint handling rules.

Related Links

Banking Code 2005 in PDF format