The Financial Services Consumer Panel is calling on financial services firms to behave more like those in other retail sectors.
Speaking at the City UK Edinburgh conference on 28 November, Consumer Panel Vice Chair Kay Blair urged financial services providers to take lessons from other retailers and focus more on encouraging customer loyalty.
Blair (pictured) said: “In most other retail sectors customers are rewarded for their loyalty. Yet, financial services firms continue to compete fiercely for new business at the expense of their most loyal customers. Such customers often find, for instance, when they come to renew insurance policies that their premiums have risen yet their cover appears to have reduced. Similarly, savers find they are penalised when introductory deals come to an end and they are dumped unceremoniously into extremely poor accounts.
“The financial services industry needs to follow the Government’s lead on the Bank of England and look outside for fresh ideas. The rest of the retail world prioritises customer loyalty and satisfaction for good reasons.
“A healthy and trusted financial services industry is critical to financial wellbeing. Firms can play a key role in developing better money habits, particularly around critical aspects such as retirement planning.
“In financial services we need to see better, simpler products; fair and transparent charging; an advice regime that is free of bias and can truly act in customers’ best interests; and effective redress when things go wrong.”