Complaints about financial products increased by 70% in Q1 compared to the same period last year, figures have shown.
In the first quarter of the year – which runs from April to June – consumers raised 74,645 financial complaints, a jump from 43,593 in the same period last year, according to the latest figures from the Financial Ombudsman Service (FOS).
Credit cards received the most financial complaints at 18,175, with most – 15,580 – of these about “perceived irresponsible and unaffordable lending”.
Hire purchase for motors was the second-most complained about financial product with 15,925 complaints, with a quarter centring on motor finance commission.
The overall uphold rate came to 37%.
Looking at mortgages specifically, the most complaints were for first charge repayment mortgages, which had 1,341 complaints and an uphold rate of 35%.
This was followed by buy-to-let (BTL) mortgages with 187 complaints, which had an uphold rate of 33%.
Second charge mortgages made up 81 complaints with a 32% uphold rate.
Mortgage complaints had fallen in the 12 months to March from 8,421 to 7,802.
Professional representatives make up half of complaints
The figures show that professional representatives accounted for around half of complaints received, an increase from 17% in the first quarter of last year.
The FOS said that using a professional representative “does not necessarily lead to a more favourable outcome” for financial complaints, pointing to only 25% of claims brought by professional representatives being upheld, compared to 40% brought directly by consumers to the FOS.
The FOS is currently consulting on a proposed case fee for professional representatives to make the “fee model fairer and better reflect the ombudsman’s costs”.
Abby Thomas, chief executive and chief ombudsman of the FOS, said: “It’s concerning that we’re continuing to see large volumes of complaints, particularly considering the cost-of-living crisis.
“It’s vital that businesses are open and transparent with their customers, treating them with fairness and understanding.”
She added: “Whilst professional representatives have an important role to play, they must ensure that their cases are well evidenced and have merit.
“If consumers have a dispute with their bank or finance provider, they can come directly to our easy-to-use service for free and we will see if we can help”.
This article was first published on YourMoney.com‘s sister site, Mortgage Solutions. Read: Financial product complaints rise by 70% YOY in Q1 – FOS
