Complaints handling: Supporting vulnerability

Vulnerability - and how best to support those customers who are vulnerable - is a growing issue for firms. Some 53 per cent of adults displayed a characteristic of vulnerability according to research from the Financial Conduct Authority (FCA) published in October 2020.  Meanwhile the number of financial services customers that could be classed as ?vulnerable? now stands at 27.7 million - a staggering 3.7 million increase since February 2020. 

The FCA's framework for best practice when supporting vulnerability puts the onus very much on businesses to drive positive change and support vulnerability. With complaints handling in particular, how can firms put this guidance into action to ensure the consistently fair treatment of vulnerable customers?

Leverage technology
The technology is available to empower employees to support customer vulnerability. One of the main hurdles to treating customers fairly is how to identify vulnerable customers. Empowering frontline staff to pick up on signs of vulnerability is vitally important. These signs might be patterns in behaviour or specific verbal clues but even the most highly trained customer service teams will see some vulnerable customers slip through the net. Vulnerability detection technology, embedded within complaint management systems, helps to identify customer vulnerability. It works in combination with intelligent workflows to ensure frontline staff take the correct course of follow-up action.

Evolving best practice
Businesses can better understand their customer base by using their own complaints data to identify where customer vulnerability might be more prevalent, highlighting any correlation between products / services and vulnerable customers. A flexible complaints process is key, with empowered and highly skilled complaint handlers able to jump out of the standard process to ensure the right outcome for a particular customer's unique set of circumstances. 

Businesses should also not be afraid to ask customers what their complaints journeys have been like. It's only by doing this that firms can pursue a strategy of continuous improvement for not only complaint handling but the fair treatment of vulnerable customers too.

Monitoring and evaluation
Perhaps the most daunting part of the FCA's guidance relates to monitoring and evaluation. This is already being used in the FCA's supervisory activity, as demonstrated by the Covid-19 deferral response for mortgages ahead of a formal evaluation of the impact of the guidance and whether their objectives have been met in 2023. Complaints data is key here, with a particular focus on Root Cause Analysis (RCA). If businesses ensure that their Root Cause Analysis key terms of reference are correct, which may very well need remodelling in-line with the FCA's guidance, they will be privy to quality insight to find out where they?re going wrong. Thorough RCA will evidence when the guidance has been implemented as well as highlighting organisational changes that have been made.

Strong leadership
Establishing a prevailing culture and ethos of supporting vulnerable customers must be a priority for business leaders. If this culture is embedded at the heart of the organisation, with these values instilled in every employee, treating vulnerable customers fairly should happen organically. This should mean that businesses don't have to be as prescriptive regarding the treatment of vulnerable customers. C-level executives should attend vulnerability training alongside complaint handlers, leading from the front and by example.

Getting to grips with the FCA's customer vulnerability guidance doesn't have to be a chore. Ultimately, it represents best practice for complaint handling, treating each customer according to their specific needs. With the right combination of tools, technology and training, financial services firms can ensure robust compliance with the guidance while improving the overall customer experience every time.

For more information on how you can implement the FCA's guidance on customer vulnerability, register for the UK Finance webinar on 24 June 2021.

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