Credit Law Conference 2013 How to put EDR schemes out of business

1

Not entirely. Decision to refer complaint to EDR is essentially the customer’s alone.

But there are steps an FSP can take that can make all the difference.

If you deal with a complaint well, your customer will be confident dealing with you directly and not see the need to complain to EDR.

Deal with a complaint poorly and you can turn what could have been a little dissatisfaction into a major gripe.

Can complaints to EDR be avoided?

Is it easy to make a complaint to you?

If your customer can’t make a complaint to you directly and easily, they’ll find other ways to have their complaint heard. EDR would be an obvious choice.

No one likes getting the run around or having to repeat themselves.

If your customer makes a complaint to anyone in your business, make sure your staff know to refer the complaint to the appropriate person within your business.

3

Cont…

Information about how to complain should be on your website, letters and even promotional material.

Give customers option of making their complaint by phone, email, on-line, post or fax.

Have a documented customer complaint procedure.

Make it (or a shorter version) available to consumers so they know what to expect and know you take complaints seriously.

4

Do you keep good records?

Keep contemporaneous file notes of conversations you have with your customers.

Keep copies of correspondence and documents like loan applications, credit assessments, credit guides, assessments and verifications made, etc.

Agents, credit representatives and authorised representatives – do you have access to their files? What if they move on? How will you respond to complaints about them?

5

Do you communicate effectively?

Acknowledge receipt of complaint promptly.

Does your customer feel that their complaint will be dealt with seriously and appropriately?

Don’t let the way you handle a complaint become a separate complaint in its own right!

Let the consumer know your next steps and estimate when you will respond to them.

In other words, don’t give them any excuse to escalate the complaint to EDR!

6

How to deal with the complaint

When you get a complaint, give it due and proper consideration.

Ask yourself: • Is there, or could there be, merit to some or all of what the consumer is

saying?

• How would someone important to you feel if they were in the situation described by the consumer.

• What further information do I need to properly respond to this complaint?

• Look for the key issues in the complaint and make sure you address them in your response.

7

Cont…

In your response:

• If you cannot agree to the consumer’s request, say which parts you agree with and which you don’t (this limits the complaint to the key issues).

• Address those key issues.

• Provide a full explanation of why you can’t agree.

• Apologise if you have to.

• Look for an appropriate compromise if there’s one.

• Offer fair and reasonable compensation if appropriate.

• Make sure your tone is appropriate.

• Don’t be too legalistic or attribute blame.

• Stick to the facts and don’t question the consumer’s motives.

8

Cont…

It’s not about being right or wrong – focus on solutions. Parties often get caught up in what has happened, rather than looking at how the complaint can be resolved.

9

Do you have the right person for the job?

You need someone who approaches complaints positively and empathetically.

Who is willing to listen to what your customers have to say. And who is solutions focused.

Someone who’s polite, patient and professional, rather than cynical, defensive or dismissive.

Someone who’s able to deal with angry and frustrated (sometimes aggressive) customers on a daily basis.

10

Do you empower your complaints staff?

Make sure your complaints staff understand your products, services and processes so they can properly respond to complaints.

Your complaints staff must be given the appropriate authority to make the decisions to resolve the complaint.

11

12

Do you learn from complaints?

Keep a record of all the complaints which have been made so you can monitor the types of complaints which are being made and how they’re being handled.

Are other consumers also affected - be proactive, fix the problem before they become complaints too.

Are changes needed to prevent the problem (and complaint) from happening again?

13

Have we got all relevant information from you?

14

Let your EDR scheme have all the information that’s relevant to the complaint as soon as you become aware that the complaint has been referred to EDR. Start by giving your EDR scheme your final IDR response or equivalent.

This helps us understand what has really happened, identify the source of any misunderstanding and verify the correctness of assertions made.

Responding to the claims

If we express concerns about a particular complaint, listen to what we are telling you.

Provide information to address our concerns.

Consider whether you need to change your position and suggest options to resolve the complaint.

Avoid getting entrenched in your position.

Be commercial – will it cost you more to deal with the complaint (both in time and external expenses) than it will to resolve it.

15

Attitude

Maintain a positive attitude and be open to resolutions – develop a reputation for commitment to seeking fair outcomes for consumers.

Some complaints may seem trivial or vexatious but the reality is you have an unhappy customer.

16