for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up
U.S. Markets

UK financial complaints body eyes use of data

The Canary Wharf financial district is seen at dusk in London, Britain, November 17, 2017. REUTERS/Toby Melville

LONDON (Reuters) - How banks and other firms use customer data to tailor loans and other products could become the next focus of mass complaints in the financial sector, Britain’s Financial Ombudsman Service (FOS) said on Monday.

The FOS rules on customer complaints that banks and insurers have not been able to resolve.

Its chief executive Caroline Wayman said faster payments and loans taken out with a few clicks on a mobile phone are services that on the whole are to be welcomed.

But the FOS sees “rising tension” between the push to offer more products and the need to protect consumer data.

“That is an area to watch really,” Wayman told parliament’s Treasury Select Committee.

New European Union rules were introduced last week to allow authorized firms to tap the bank account history of consumers - with their permission - to see if they would benefit from cheaper services elsewhere.

The FOS spends much of its time handling complaints about misselling payment protection insurance (PPI). It has become Britain’s costliest financial scandal, forcing banks to pay out 28.8 billion pounds in compensation since January 2011.

Regulators have set an August 2019 deadline for PPI claims, and Wayman said the FOS was getting ready in case there is a “rush to the finish” with many last-minute complaints.

Growth in payday loan complaints was, however, probably the fastest in the FOS workload at present, she said.

Reporting by Huw Jones; Editing by Gareth Jones

for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up