Summary Resolution Communication

Thursday 11 January 2024

Introduction

Credit unions have specific reporting rules laid out in CREDS 9, and the new rules affect them differently than other firms. For example, other firms are now required to report all complaints, while credit unions will continue to only report those complaints that are not resolved within the next business day.

If you have any questions or comments on this information guide, please contact your Member Relationship Manager by emailing them directly at members@abcul.org or calling 0161 832 3694.

Informal resolution period

The rule whereby a financial institution has until the next business day to informally resolve a complaint has been extended to the 3rd business day following the day the complaint was received. The complaints time limit rules and complaints forwarding rules do not apply to these complaints. Credit unions will not have to send a final response letter, but instead, they will need to send ‘summary resolution communication’ described below.

Summary resolution communication

Firms will be required to send a ‘summary resolution communication’ where a complaint has been resolved to the customers’ satisfaction within the 3 business days mentioned above. This communication is simpler than the tailored final response letter and is expected to be a written template message.

Guidance is available at DISP 1.5.6G , which confirms that firms may use other methods to communicate the message where this would better meet the complainant’s needs, such as where a customer is visually impaired, and/or where the complainant has been getting in touch using a different method.

The summary resolution communication must contain the following:

  1. Reference to the fact that the complainant has made a complaint and informs the complainant that the respondent now considers the complaint to have been resolved
  2. Tell the complainant that if he subsequently decides that he is dissatisfied with the resolution of the complaint, he may be able to refer the complaint to the Financial Ombudsman Service
  3. Provides the website address of the Financial Ombudsman Service
  4. Refers to the availability of further information on the website of the Financial Ombudsman Service.
  5. Whether or not the firm consents to waive the time limits for complaining to the Financial Ombudsman. Firms must use the prescribed wording in DISP 1 Annex 3 in the FCA Handbook to meet this requirement where possible.

Additional information can be included in the summary resolution communication, for example, encouraging customers to get back in touch with the firm to consider the complaint further if they remain.

We have provided an example Summary Resolution Communication for members here. 

Complaints Reporting

The existing rules for reporting complaints are outlined in CREDS 9. Complaints resolved within 1 business day do not need to be reported, whilst all other complaints need to be reported via the credit union specific complaint form available here.

Financial Ombudsman Service

A member may go directly to the Financial Ombudsman Service with their complaint before resolution if both the member and the credit union consent providing that:

  1. The Financial Ombudsman Service has informed the member that the credit union must still deal with the complaint within 8 weeks and may deal with the complaint more quickly
  2. After being informed of this fact, the member still wishes The Ombudsman to deal with the complaint.

As mentioned above, in these circumstances the credit union must continue its complaints handling procedures and deal with the complaint within the standard 8 week timeframe.

Conclusion

The fact that the complaints handling rules in DISP do not align with the reporting regime in CREDS is a result of an oversight on behalf of FCA. We have brought this to their attention but which they are not minded to change. As a result, credit unions will change their complaints handling procedures whilst retaining the previous reporting rules and forms. It could be argued that credit unions benefit from continuing to report only on those complaints resolved after the next business day and retaining the less onerous complaints form.

If you have any questions or comments on this information guide please contact your Member Relationship Manager by emailing them direct, on members@abcul.org or by dialling 0161 832 3694.

Further guidance is available for download in the ABCUL Member Resource Library here.