Banks still pushing sales despite mis-selling

| December 10, 2012
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.

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  1. Darren says:

    The fact is CPP card protection was missold on the insurance elements but the life assistance side of it is very useful for example the one number to stop all of your cards regardless of the issuer and the lock and key cover too. But I know for a fact that when activating santander cards the staff end up sending loads of customers back to the bank as they have been signed up for the 123 credit card as well as the 123 debit card without knowing. Also can I ask what has happened to the company Sentinel gold who sold the same products?????