The banking regulator is urging banks to improve the way they support customers who need to access funds in event of bereavement or power of attorney registration
The Financial Conduct Authority (FCA) said that banks and building societies need to improve how they treat customers affected by bereavement or registering a power of attorney.
The latest FCA review found ‘many areas for improvement’, with a requirement for better training and monitoring of staff.
It said that some bank staff were unclear on the actions they needed to take and how quickly, especially when a customer’s capacity suddenly changed or when funds were urgently needed. In some cases, this meant some individuals and their representatives were unable to access funds to pay essential bills.
There were examples of customers who struggled to get support during an emergency, such as a mental health crisis, adding to their distress, the FCA said.
In addition, in some instances while systems were in place to record customers’ needs, it was not always clear that staff were consistently using them. The FCA noted some instances of staff failing to check or respond to support needs recorded on a customer’s profile.
Problems with training and competency were also contributing to staff failing to follow the correct process.
In some bereavement and PoA cases, staff did not acknowledge that customers were noticeably distressed and upset. As well as a general lack of empathy, these instances suggested staff were unable to recognise potential support needs or lacked the training to help them to do so.
Emad Aladhal, director of retail banking, said: ‘Dealing with a bereavement or setting up a power of attorney can often be stressful and emotional.
‘When banks and building societies fail to recognise and respond to customers who need more help, it adds to the stress. All firms should consider where they can make improvements.’
The regulator has published a review of good and poor practice to help financial institutions provide the right support by being adaptable and putting consumers’ needs at the forefront of everything they do, in line with the Consumer Duty.
The best performers made regular check-in calls by bank employees and emailed summaries following phone calls. These interventions helped consumers feel more informed and helped to deliver improved outcomes for customers.
The opposite was found in each negative experience, where interviewed consumers reported more standardised approaches. This made it difficult for them to communicate and achieve what they were trying to do as well as making them feel like the provider did not care.
Some banks had clear vulnerable customer policies and procedures, which often set out the expected timeframe for staff to process registration of bereavement and power of attorney cases. They had also performed gap analyses against both the FCA’s Vulnerability Guidance and the Consumer Duty.
Some firms took steps to help ensure that policies and procedures did not prevent them from delivering good customer outcomes in complex cases. This included holding forums to which complex cases could be escalated, so they could develop individual solutions that may fall outside a strict interpretation of internal policy.
The FCA said banks should help ensure guidance is easily accessible and understandable, and that policies are clear that staff should adapt their style to the customer’s needs and recognise when matters should be escalated.
The review followed interviews with 1,500 individuals using a standardised questionnaire, both online and face to face, covering consumers with characteristics of vulnerability, and those without.