10 Comments 10 Commentsby Ksenia Stepanova
Financial Services Complaints CEO and financial ombudsman Susan Taylor told the Financial Markets & Credit Law conference that she's "absolutely deluged" with cases against non-bank lenders, financial advisers, and fund managers.
Her service received 1,500 complaints last year - a 3% increase on last year, and double the number from five years ago.
Complaints have picked up further since June 2025. Taylor says there has been an "absolute flood" arriving daily, with no single product or provider dominating. The complaints spread across the entire financial sector.
She says a lot of this is down to ongoing economic pressures - but also, hopefully, a growing awareness of resolution services.
Complaint numbers and categories
Non-bank lenders received 38% of all complaints, though only 73 became formal disputes. Card providers like American Express and Wise ranked second, followed by payment services. Financial advisers received the fewest initial complaints.
However, of the 366 complaints that became disputes, financial advisers topped the list for the first time in 15 years.
Insurance advisers faced three main issues: inappropriate advice, lack of help at claim time, and poor communication between adviser, provider and client. The latter was prevalent across all areas of the industry, not just insurance advice.
Key steps to resolving complaints
Anything from defensiveness to lack of communication, or lack of follow-up can escalate a complaint further than it needs to go.
One issue is that most clients don't know where to complain. Taylor said that less than one-third of clients find Financial Services Complaints through their provider - the rest used Google, heard from friends, or learned from other providers.
"There is work to be done by the industry in improving that accessibility for clients, so that they know where to go," Taylor notes.
Another step is to actually use the word ‘complaint.’ Taylor says that she often sees the more neutral term “feedback”, but the process needs to be upfront, and able to be found within a few clicks.
Acknowledge complaints in a timely manner and follow them up. Poor communication is the root of many of the complaints seen by Taylor, and brushing it off or failing to understand it can easily make the situation worse.
“It’s also really important to show empathy,” Taylor says.
“Many of the complaints that come to us - when our staff read the response that they’ve had from an adviser or provider, it’s written in a very defensive or sometimes accusatory style. Obviously, that only inflames the situation and makes the client want to escalate the complaint to us.”
Then, apologise. That doesn’t have to mean you’re accepting liability, but a simple phrase like “I’m sorry that my service fell below your expectations on this occasion” can work well for de-escalation.
Ask questions, and find a swift solution. This shows you’re interested and are taking the complaint seriously.
Finally, follow up. That’s important from a risk and reputation point of view, as dropping communication too early can lead to the client escalating.
“If you’ve given the client your response and you don’t hear from them, don’t necessarily assume that they’re happy,” Taylor says.
“If you haven’t heard from them in two weeks, it’s a good idea to send a follow-up email or get them on the phone, just to make sure that they are happy with the response you sent.”
Broader trends in the complaints space
AI has left nothing untouched, and has also entered this area - both for better and for worse, according to Taylor.
She notes that there’s an increasing number of people using AI to make complaints, and also to write the submissions during the complaints process.
Taylor was recently at an international conference, where she heard from the industry this is becoming a wider-scale issue.
“Possibly, people who previously didn’t feel confident in writing a lengthy email or letter can now get AI to write the complaint for them,” she explains.
“Worse for us is that when we’re investigating, we sometimes get 100+ pages of AI-generated submissions. As you can imagine, that’s hugely time consuming for our case managers who have to use AI themselves to try and summarise it!
“And they contain hallucinations. Quite where that’s going to go I don’t know, but it doesn’t help when we’re already at historically high levels of complaints.”
As complaints are on the rise, so is challenging conduct. Taylor says there has been a real increase in that, and so it’s more important than ever to make sure your team is well trained and supported.
“I hope this isn’t going to become an increasing trend,” she said. “But looking ahead, unfortunately, I think we are going to see this high level of complaints continue.”
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Not only was it an absolute joke of a document that was actually funny to read, it was extraordinarily difficult to write a serious response to it because it:
- cited irrelevant legislation (example it went on a lengthy tirade about how "declining" a claim that had not yet been lodged, the client had been "discriminated against" - a breach of the Human Rights Act (LOL)
- cited legislation that doesn't exist and has been repealed/replaced
- accused me of being responsible for insurance-provider decisions regarding a claim
- referenced events that never happened
If clients are going to use AI to write complaints then this is what we're going to see. Because it's crap.