Banks still pushing sales despite mis-selling
Consumer group Which? claims that bank staff are still under pressure to sell products to customers, despite the recent scandals over mis-selling.
Mis-selling of Payment Protection Insurance (PPI) has cost banks over £10m in compensation to customers, but bank staff are still being driven by sales targets and incentives to sell products to customers.
According to new rules, staff incentives should now be based on clear criteria related to customer service, rather than sales targets, but in the Which? survey, 65 per cent of sales staff said that pressure to hit sales targets had actually increased.
Which? surveyed 500 sales staff at HSBC, RBS, Lloyds, Barclays and Santander.
Peter Vicary-Smith, Which? chief executive, said: “Our survey reveals the stark realities of the sales culture that still exists at the heart of the banking industry.
“Senior bankers say the culture is changing but this shows it just isn’t filtering through to staff on the front line who remain under real pressure to put sales before service, even after incentives are taken away.”
Of the 500 people surveyed by Which? 50 per cent said they were aware that some of their colleagues had mis-sold products in order to hit targets.
Which? will release its findings to the Parliamentary Commission on Banking Standards, the Financial Services Authority and MPs.
The consumer group is calling on banks to follow the example of Barclays and The Cooperative bank which have restructured their incentive schemes in order to focus on customer service.
Which? followed up its research by interviewing bank customers and four in 10 said that when they last contacted their bank they were offered a new product or service that wasn’t suitable.
A quarters of this group said they felt pressurised to accept the product or service being offered.
In a programme to be broadcast this evening, Dispatches will claim that in 2006, high street banks directed customers to a call centre run by card insurance firm CPP to activate or confirm receipt of new cards.
In November 2012 CPP was fined £10.5 million by the Financial Services Authority (FSA) for widespread mis-selling of insurance products.
CPP’s number was printed on new cards sent out by banks such as Barclays and Natwest, raising concern that customers may have been sold unnecessary card protection insurance when phoning to activate their cards.