In 2021, credit or consumer reporting complaints made up 59% of the total consumer complaint volume to the CFPB according to their annual report of credit and consumer complaints. Additionally, the average number of credit or consumer reporting complaints per consumer was 3.41.
These trends are likely to remain unchanged with consumers’ concerns about the impact of missed payments and increased collections efforts following the pandemic. Additionally credit bureaus are providing customers with access to credit reports on a weekly basis. So it stands to reason that complaints will continue to increase. With that in mind, here are key components to develop and maintain a strong, effective complaints management program.
1. GOVERNANCE to ensure a sustainable program and employee engagement
Determine what is expected and memorialize through documentation. These requirements are reinforced through training and tie to expected performance.
2. DETECTION, CAPTURE & ESCALATION guarantee that what is expected is being done and communicated properly
Implement methods to effectively communicate expectations and identify and document instances requiring attention. Confirm exceptions are communicated promptly to the right people for appropriate next steps.
3. ANALYSIS & RESOLUTION aids in decision-making and drives change
Analyze to identify the root cause and formalize remediation needs. This should not be limited to the “highest volume” complaint types, as we have seen a small number of complaints be signs of significant underlying issues.
4. REPORTING & MONITORING ensures widespread awareness and accountability from the top down
Appropriately record and categorize complaints and use the data to drive business decisions and to inform policies, procedures, monitoring and training.
Top-to-Bottom Enterprise Buy-in: Everything relating to risk and control must have board and senior leadership agreement on its importance and expectations.
Effective Case & Workflow Management Tools: You need proper case management to be able to process documents and hand-off to the right resources. Complaints should be reviewed centrally and segmented for escalation due to legal issues involving potential consumer harm from unfair or discriminatory treatment, or other regulatory risks.
End-to-End Consumer Focus: Regardless of where the consumer is in the complaints journey, you must keep that person’s perspective in mind to ensure regulatory compliance and consumer loyalty. The way you respond to COVID-19 inquiries or complaints can differentiate and drive consumer confidence in your organization.
Reliable Data & Advanced Analytics: Inadequate data and broken reporting mechanisms are inefficient and hinder your ability to identify trends. Analysis should be system-driven to include detailed tracking of important data. Your data should include the number of complaints, severity, classification, response timeliness and the relevant functional business area(s) to determine root cause and corrective action. Then, the data pieces need to be joined to examine enterprise-wide complaint activity.
Strong Governance & Oversight: Leadership must create and maintain an authentic “culture of complaints as gifts” to clearly define accountability and expectations for behavior, communication, and actions.
Success of governance and oversight should translate into improved first contact resolution, a reduction of repeat consumer complaints and reduced complaint volumes in relation to your consumer base.
In view of all that’s going on in the world, take time to pressure test your complaints management program.
Bridgeforce can evaluate your program. We’ve worked with financial institutions of all sizes to assess their credit bureau complaints management programs as a part of our proven, proprietary Credit Reporting and Disputes Management methodology.
Contact us today to talk through your needs.