Complaint Management Best Practices: Financial Institutions
Why is Effective Complaint Management so Important?
More than ever before, financial institutions are assuming the role of technology companies. Bank and credit union customers are interacting with their financial institutions through mobile apps and online more than ever before, and with that transition comes an increased emphasis on customer experienc
e. Rather than interacting with tellers, customers are interacting with their phones, and the new medium presents a host of challenges when it comes to building relationships with customers.
Central to managing the virtual customer relationship is the customer complaints process. Customer complaints are inevitable; no matter how efficient and diligent a company’s operations are, it’s impossible to predict every surprise before it happens. Banks and credit unions can differentiate themselves from competitors by focusing on the manner in which they resolve complaints, rather than on the number of complaints received.
When complaints are handled well, they can actually improve customer satisfaction, increasing customer loyalty and providing a competitive advantage.
Banks, credit unions, and other financial institutions are beginning to recognize the benefits of formalizing their complaint management processes. In addition to reducing churn, effectively resolving complaints can help you avoid burdensome regulatory troubles:
- Many bank and credit union complaints are closely monitored by regulators like the Consumer Financial Protection Bureau (CFPB). If multiple customers complain about a similar issue and a regulator notices a trend, the result could be an enforcement penalty.
- Customers also have the ability to report directly to regulators, which they may well do if the problem is not solved quickly enough.
How to Respond Effectively to Customer Complaints
Companies with effective complaint management policies do a few things:
- They make it easy for customers to submit a complaint.
After an incident (large or small) occurs, a customer’s first impulse is to notify the provider. If he or she does not have easy access to a customer service or complaint submission number, the process is already off to a bad start. Depending on the size of your company, you should offer a direct line, devoted to customer complaints, so users can quickly and easily report any problems they run into. Very large companies should even consider having multiple lines dedicated to different categories of complaints.
- They record and evaluate all complaints in a centralized location.
As discussed, regulators like the CFPB are on the lookout for patterns in the types of complaints submitted to financial institutions. By centralizing all complaints, companies themselves can detect such trends before they become serious enough to receive outside notice. Taking a root-cause approach to complaint analysis allows you to unearth commonalities between complaints that might seem unrelated at first.
For example, one customer might report a problem with her funds availability after she accesses her account and attempts to view historical data. Another customer reports being hit with an overdraft fee even though he has more than enough money in his account. These appear to be different issues, but when the organization considers them together, it discovers a technical issue similar to the “application glitch” recently addressed by a major investment management company. This glitch has been causing the system to show incorrect balances, and some customers are being hit with overdraft fees as a result.
- They respond promptly.
It’s not always possible to resolve an issue in a few hours, or even a few days. Companies should keep customers updated regardless of the solution timeline; something as simple as a notification that the complaint has been processed and is being looked into can be enough to assuage a customer during the remedial process.
- They have developed thorough complaint resolution processes that are easily accessible to all relevant parties at the organization.
As with any vendor risk management process – compliance, vendor assessments, incident management, etc. – complaint resolution should adhere to enterprise-wide standards. These standards should be housed in the same “centralized location” to which complaints themselves are submitted. This allows any relevant party at the institution to report a complaint and initiate the official remedial process.
- They perform regular analysis and reporting.
In addition to responding to and solving individual complaints, successful companies report on overall trends to ensure the root causes (not the symptoms) are being fixed.
The LogicManager Platform Provides:
- Cascading fields that walk the user through the complaint documentation and review process
- A robust, customizable root-cause library that helps identify the common denominator between various complaints
- Seamless integration with email and third-party tools: LDAP, SSO technology, API integration, and data upload functionalities
- A robust enterprise risk management reporting engine that helps display trends over time and allows you to reaggregate data according to a variety of parameters