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25 August 2020

Using DataEQ to implement the FSCA Banking Conduct Standard and improve customer outcomes

Prioritise and categorise your social media complaints.

By Nic Ray, DataEQ CEO

On 3 July, The Financial Sector Conduct Authority (FSCA) published a Banking Conduct Standard aimed at ensuring fair treatment of banking customers. Based on the six Treating Customers Fairly (TCF) outcomes, the Standard empowers the regulator to take action against banks who do not comply with its conduct requirements.

The issue of customer complaints is a key part of the new Standard, informed in particular by TCF outcome 6: “Customers do not face unreasonable post-sale barriers imposed by firms to change products, switch providers, submit a claim or make a complaint.”

The Standard’s definition of a complaint is broad. According to the Standard, any “expression of dissatisfaction” can be considered a complaint. This is understood to include complaints made to banks via social media.

The complaints component of TCF Outcome 6 is addressed in Section 8 of the Standard, which is more rules-based than the other sections. It prescribes the establishment of a Complaints Management Framework that includes, among other things, the categorisation of complaints made by customers. Today, many of these complaints are lodged on digital channels.

Social media continues to grow significantly as a preferred channel for customer queries and complaints. This preference for digital channels has been accelerated by the ongoing Covid-crisis. DataEQ’s analysis of social customer service in the banking industry during lockdown found that conversation volumes for the industry grew by 61% while response rates to customers fell by 39%. As the adoption of digital banking services expands, and new regulations are enforced, banks will need to ensure they can collect, sort, and swiftly resolve these digital complaints.

DataEQ’s Market Conduct solution has been designed to meet the increased demands of outcomes-focused regulations. We work with multiple financial services clients to help them identify conduct-related issues in social media conversation. We structure and categorise this conversation in accordance with the categories set out by the FSCA in Section 8(7) of the Standard. This process improves comprehensive and automated reporting that enables our clients to demonstrate to the regulator that fair outcomes are consistently delivered. In some instances, we also help these clients report on their internal conduct standards and risk categories, including mapping internal standards to TCF outcomes.

The Standard also stipulates “the complaints management framework must at least provide for appropriate communication with complainants”. To this end, our Engage platform is proving a powerful tool for DataEQ clients to identify, prioritise, and respond to customer complaints. We have successfully optimised banks’ social customer service workflow and significantly improved their customer experience.

We believe our Market Conduct solution and our Engage platform will help clients significantly improve reporting standards and optimise social customer service, in turn, mitigating risk and improving outcomes for your customers. We would love to set up a meeting with your conduct and risk teams to talk through our capabilities in relation to the new Conduct Standard.

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