Canadians were up in arms earlier this year when a regulator’s report into how banks deal with customer complaints was overdue. Mohamed Dabo reports on the damning subsequent review.

The Financial Consumer Agency of Canada’s (FCAC’s) found shortcomings with how Canada’s biggest banks handle consumer complaints.

Go deeper with GlobalData

Data Insights

The gold standard of business intelligence.

Find out more

The findings were in two reports released by the Financial Consumer Agency of Canada, the federal regulator tasked by the government with reviewing internal bank complaint-handling procedures (CHPs) and the effectiveness of external complaints bodies (ECBs).

The FCAC estimated that more than five million consumers lodge at least one complaint with a bank every year, most of which are dealt with internally and at the first point of contact.

The sweeping review found, however, that both internal and external processes used by the lenders have flaws in them.

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

A number of deficiencies 

The deficiencies include lengthy delays when customers try to escalate their complaints past the level of a branch or call-centre employee.Canadian banks are required to have internal systems for dealing with those complaints and to be a member of one of the two government-approved external ombudsman offices.Both the banks and the external watchdogs, however, have “a number of deficiencies” in their complaint-handling policies, procedures and operations, the FCAC found.

In addition to unreasonable delays and inadequate training, those shortfalls include concerns about a system that allows banks to choose their external ombudsman.

“Banks do not make it easy for consumers to escalate complaints,” the report noted.

External Complaints Bodies  (ECBs)

External complaints bodies (ECBs) are organizations that are independent from the banks and federal credit unions. They deal with customer complaints about banking services and products. All banks and federal credit unions must be a member of one of the ECBs.

The FCAC says it will address the deficiencies via its supervision work and with a new financial consumer protection framework being implemented by the government.

The agency is also to oversee a third-party review of ECB operations later this year.