Banks and credit card schemes could soon have to do a lot more than feign understanding to angry customers berating them on social media.
Australia's financial regulator has just flagged it could soon classify Twitter and Facebook sprays as official complaints.
In what could soon be a massive jolt to the so-called customer experience industry, the Australian Securities and Investments Commission (ASIC) is weighing-up if frustrated people letting fly on social media should be counted as official complaints for Internal Dispute Resolution (IDR) processes.
It’s a move that’s clearly aimed at stamping-out longstanding practices like making it so difficult, laborious and time consuming to complain about services that consumers just give-up.
But while the telecommunications sector is by far the national exemplar of making it hard to complain, the recent rash of regulatory interventions for banks mean that sector’s customer might soon just fire off a tweet to log a complaint that will legally need to be acted on.
Welcome to flame central
The proposed complaint-by-social media shake-up is contained in an ASIC discussion paper on internal dispute resolution issued with minimal fanfare this week.
“It is widely acknowledged there is room for much improvement when it comes to handling consumer complaints in our financial system,” said ASIC deputy chair Karen Chester.
“Consumers expect and need a fair, timely and effective way to have their complaints dealt with, and to be provided redress where appropriate. The absence of such effective redress, and the failure of firms to identify and look into systemic complaints, were key findings of the FSRC and the Prudential Inquiry into the CBA.”
So in the wake of the Royal Commission into banks, the financial regulator has set about reforming the system used by people to make complaints to institutions and preferably getting them resolved internally before they end up on the regulator’s or a watchdog’s desk.
R U SERIOUS?!
The big complaints process clean-up includes proposed limits on how long it takes to resolve a complaint, better complaints data reporting and widening the avenues for people to complain instead of hiding behind PDF files and postage stamps.
Specifically, ASIC is asking “what constitutes a complaint, including if received by way of a firm’s social media.”
“Do you consider that complaints made through social media channels should be dealt with under IDR processes? If no, please provide reasons.” ASIC’s consultation papers asks banks, though anyone is free to lodge a submission.
It also asks financial firms (that’s banks) "deal with complaints made through social media channels [and] whether the treatment of social media complaints differs depending on whether the complainant uses your firm’s own social media platform or an external platform".
The ASIC paper also drills down in what actually constitutes a complaint for regulatory purposes, including broadening interpretations around customer statements of dissatisfaction.
The biggy is people on social media making talking “about” a bank or service rather than listing a specific incident or problem
“The inclusion of expressions of dissatisfaction made ‘about’ an organisation does, however, mark an important development. By broadening the definition in this way, AS/NZS 10002:2014 [the IDR official standard] establishes social media as a legitimate channel for making complaints,” ASIC said.
“We consider this to be appropriate, given that long-established patterns in how consumers complain to organisations are changing significantly.”
The implications for banks and payments schemes are massive – from both a regulatory and potentially financial perspective.
Yes, we know there's an outage and we are generally crap
Just take outages, which frequently inconvenience millions of consumers by restricting access to funds, or hit businesses hard by limiting payment channels.
Outages, as any bank will tell you, are pure social media hell as they struggle to keep angry customers appeased and their reputations intact.
While businesses can currently receive compensation for payments outages and frequently do to the tune of millions, it’s far less clear what redress or compensation consumers might be entitled to.
Would, for example, a consumer without a car hit by a payments outage be entitled to a cab fare home to come back from a supermarket after doing a physical weekly shop with cash rather than ordering online?
Banks told iTnews they were looking at the ASIC complaints consultation very closely, especially where to draw the line between a general spray and something actionable.
Institutions also said they routinely and quickly jumped on gripes from real customers to resolve issues and had done so for years.
Banks and individuals have until August 9th 2019 to make a submission to ASIC and can download the discussion paper [pdf] from ASIC’s website.
