Can you be confident that you’ve made all reasonable efforts to reach your customers?
David Williams is managing director at Trace & Connect
The recent fine handed to Lloyds Banking Group (LBG) demonstrates that customer conduct remains a crucial focus for the FCA.
According to the FCA press release, in LBG’s case, it was their reported lack of understanding of customers’ circumstances that created the potential risk of unfair treatment.
In their case, I think it assumes contact with the client, but what about circumstances when you can’t reach your customer?
It’s a common problem and if you struggle to make contact, can you be confident that you’ve made all reasonable efforts to reach your customers? And can you demonstrate that you have? And if you can’t make contact can you be confident of good outcomes?
What sounds like relatively simple questions are, I believe, becoming increasingly difficult to answer. The impact of coronavirus is adding complexity to the challenge.
For one, customers are more nervous to talk, two, managers and their teams are under strain having to focus on new ways of working and three, staff are facing large workloads with numerous priorities.
All of this could potentially lead to firms taking their eyes off the ‘making contact’ ball. And let’s not forget that existing issues will remain:
- Data. I’ve heard of various stories where literally hundreds and sometimes thousands of letters are returned to firms because straightforward details such as the name or address are wrong on the envelope. What does this say about firms’ central systems and controls? And let’s face it – simple errors such as data extraction and data merging to letters can and do happen, even before we get to input errors, managing data or data that’s out of date.
- Phone numbers change. The UK population, according to data published in 2014, gets through 21 million new mobile phone numbers a year. Most lie dormant, but have you got the most up to date one for your client on your system? Increasingly, as mobile becomes the norm, landlines are being used less and less, and so another avenue to potential contact is removed.
- Customers don’t always behave as you expect – yes, life gets in the way of even the best-laid plans. Divorce, separation, a new job, illness, and other vulnerabilities can all lead to a customer not answering your call, or not even being in the property you expect them to be in.
Coronavirus, however, allows you to revisit your contact strategy, providing the potential for review to make improvements to ensure better outcomes for clients.
That starts with making contact in the first place. We know from experience that contact rates are low in the industry, for example, we were involved in increasing a leading bank’s interest-only contact rate to 65% when industry response rates at the time were c30%.
Specialists can and do add value by having experienced staff who know how to make contact with hard to reach or vulnerable customers bringing knowledge of regulation, data rules and technology together to put you in touch with clients successfully.
Specialists also understand and have experience of human behaviour and can help you adapt your communications and processes to increase contact rates whist keeping the customer onside.
So, while firms continue to say that the customer is at the heart of their business, now more than ever, is the time to review strategies, whether you’re a broker or lender - right from the very start of the process. Making contact.
