Banks are under pressure to transform how they identify and handle customer complaints. Complaint volumes have risen dramatically as customers try any way they can to get a satisfactory resolution to their issue. The Consumer Financial Protection Bureau complaint database shows the number of complaints they receive per month more than tripled from December 2019 to October 2022.
As complaint volumes rise, compliance teams are increasingly overburdened by manual processing that make it harder for them to identify, triage and resolve in a timely manner. Bank leadership also recognizes that, as the volume and average cost per claim grow, they are exposing themselves to penalties that could be preempted by effective complaints management.
Taking a customer experience lens to complaints management means banks must transform from a compliance-centric focus to a customer-centric approach that leverages data, technology and process to operationalize complaints capture, analysis and handling at scale. When customers are able to voice their issues, banks have the opportunity to resolve them in a way that can build lasting loyalty.
By flipping the script to a customer-centric approach, banks transform and drive value from complaints by:
Shifting from limiting sources of complaints to operating on the principle that complaint data is valuable feedback that can improve customer experience while reducing risks and costs
Prioritizing a better customer complaint experience and solving root causes, instead of optimizing for closing and reporting complaints
Connecting complaints management with customer-care processes, and bringing complaints data together with other customer data insights and actions to improve experiences
Banks often have separate, sometimes home-grown and dated, complaints management systems and workflows for each line of business that often don’t share data. By leveraging advanced technology and process changes, banks can radically raise efficiency and deliver more actionable reporting and root cause analysis. Making this transformation happen means bringing compliance and customer experience teams together, along with experience and claims management systems and processes, in three main ways:
Centralize and automate the capture and analysis of complaints data from multiple structured and unstructured (free text and speech) sources, continuously, reliably and at scale using artificial intelligence-enabled natural language understanding (NLU). This can greatly reduce time-intensive manual processing by the complaints team, and free them up to perform more value-added handling of escalations. Complaints sources can also be expanded to include messages from customer-facing employees, online complaint forms, chat logs, customer survey responses, voice recordings from contact center interactions and social media, as well as via downloads of customer complaints from the CPFB and other third parties.
Automate the review, triage and routing of potential regulatory versus non-regulatory complaints in the order to be handled, tracked and reported. This improves accuracy and efficiency while raising performance on close rates and speed of resolution, and reducing escalations. For example, a customer voicing unhappiness with the closing of a branch can be routed to a regional branch network team member, while a customer applying for a mortgage who believes they have been treated unfairly can trigger alerts to a more senior business manager and a member of the risk and compliance team for immediate follow-up.
Provide reporting mechanisms that drill down on complaint analysis and provide operational data for leadership and teams to uncover and solve for root causes of complaints and irritants, and ultimately reduce complaints volumes.
The worlds of risk and compliance are converging with customer experience. This is good news, as the opportunity to capture the value of increased efficiency and increase customer loyalty while improving risk management grows in concert with rising customer power, heightened regulations and evolving technology.
What this means for banks is significant – reducing the costs of complaints, risk of fines and negative reputation while delivering increased efficiency and improved customer retention, in no small part through a much better issue resolution experience. And as root causes of poor experiences are solved, banks will ultimately see their complaint volumes decrease.
Daniel Brousseau is head of financial services industry strategy and experience at Medallia.