Many people miss out on a potential rebate or refund because they are reluctant to write a letter of complaint. For example, in the UK, there has been an investigation into the misselling of loan insurance (payment protection insurance). It has been estimated that the insurance schemes are so profitable that the banks keep upto 80% of customers fees. The FSA has found many instances of misselling and many customers may be entitled to a refund. If that is the case, writing a letter of complaint may enable you to get a refund.
Here are some tips for writing a letter of complaint.
1. Be Aware of Potential Refunds.
Banks and financial institutions often make mistakes. Salesman often fail to let you know of all the small print. If you feel you have been paying too much for a product or that bank charges are unfair; investigate whether a refund may be possible. Examples of issues which might involve claiming a refund or compensation:
- Fees or charges increased or made without the knowledge of customers: (Mortgage exit Fees)
- Products not properly explained or not fit for the purpose stated.
- Pushy Salesman who fail to explain all details (e.g. Loan insurance is not essential to get a loan)
2. There is Nothing to Lose.
Similar to the first point, writing a polite letter to the bank is your right as a customer, don’t worry about the time or whether you are 100% right. I’m not suggesting you write for every minor problem. But, if you have been missold a product or have been charged unfairly, a simple letter of complaint may lead to a significant refund. It is a shame to miss out on this.
3. Be Calm and Polite.
Being charged unfairly can make us very angry and upset. However, it is important not to write emotional letters that seek to blame and point the finger. It is more important to calmly state the facts and write in a professional manner. (It is also good for your inner health, getting angry just makes you feel miserable at a later stage) Try to be detached.
4. Be specific.
When writing a letter don’t just say “I was hopelessly overcharged” Give details of your account, state what happened and when. Try to make reference to your terms of contract. If a salesman missold you a product try to give his name or at least a date and time of when it was sold to you. The more details and facts you can give the more the bank will take notice of you.
Ask for a specific remedy or compensation.
Be reasonable in your request as most organisations give discretion to their staff for minor issues
5. Be Knowledgeable.
If your letter gives the impression that you know the correct procedures for complaining they will be more concerned. For example, you should mention that if they fail to deal with your complaint you will follow it up with the correct financial regulator (in UK, probably Financial Ombudsman)
5. Send Your Letter to The Right Place.
Try to send your letter to the person responsible for your account / selling your product. If possible ring your bank and find the name of the best person to send it to; although, often the bank will have a division for complaints e.g. customer services.
6. Follow up the Letter.
Keep track of when you send the letter. If the bank do not respond within a certain time frame, follow it up with a second letter or phone call. This time send a copy to your bank manage or different department (it may just be that you sent letter to wrong place and has been ‘filed’ for later. If this doesn’t work, try writing to the relevant financial service regulator.
- Template of letter of complaint to Bank
- Bank complaints – site dedicated to bank complaints
- How to Complain about Financial Services & Products