Findings from the maiden market on-site supervision exercise carried out by the Bank of Ghana indicate that banks are handling customer complaints poorly.
For the duration of the exercise, the report stated that there was no evidence of Board of Directors of financial institution taking action on customer complaints reported to them.
Again, according to the report, which was carried out from November 2019 to February 2020, some of Consumer Reporting Officers (CROs), stationed at the various banks, failed to submit reports on customer complaints to the Board.
Also, recorded customer complaints were not shared with the Bank of Ghana in line with the current market conduct regulatory regime.
Findings of the Market Conduct Examinations is published on the regulator’s website.
As part of the exercise, officials of the Market Conduct Office visited eight selected banks to examine the structures, systems, and processes in place to promote consumer protection and the early resolution of customer complaints, and to generally assess compliance with relevant market conduct rules.
The examinations covered a number of key areas including; Board and Management oversight of the complaints handling function, unfair banking practices; privacy and data protection issues; ambience of banking halls; disclosure and transparency; and the content of marketing material.
The report further revealed that channels provided by banks to enable customers to lodge complaints such as SMS, Website portal and dedicated telephone lines, did not function.
Also, the banks failed to comply with Bank of Ghana’s complaint resolution timelines, the report said.
The on-site market supervision also discovered that customer complaints data was under-reported to the Bank of Ghana.
Market Examination Office
Following the completion of the banking and Specialised Deposit-taking Institution (SDIs) sector clean-up in 2019, the central bank of Ghana established a Market Conduct Examinations Office within its Financial Stability Department.
The office was, among others, to ensure adequate focus on the conduct of banks and Specialised Deposit-Taking Institutions (SDIs) towards their customers.
“This was to complement the prudential supervision of banks and SDIs by the Banking Supervision Department and the Other Financial Institutions Department, the objective of which is to promote the safety and soundness of these institutions”, part of the report read.
The seeting up of the Market Examinations office is backed by the Banks and Specialized Deposits-Taking Institutions Act, 2016 (Act 930), the Borrowers and Lenders Act, 2008 (Act 773), and the Credit Reporting Act, 2007 (Act 726).
Section 3 of Act 930 mandates the Bank of Ghana to, among other things, regulate and supervise the conduct of banks and SDIs.
“In pursuance of section 3(2)(d) and section 92(2)(a)(xi) of Act 930, the Bank of Ghana issued the Consumer Recourse Mechanism Guidelines for Financial Service Providers in 2017 to provide customers of institutions licensed by the Bank of Ghana (banks, Savings & Loans Companies, Finance Houses, Rural and Community Banks, Micro Finance Institutions and Forex Bureaus) with access to adequate redress that is fair, efficient, timely, and without cost to the complainant”.
The Guidelines require licensed institutions to display notices in all branches, informing their customers of the processes in place at that institution for lodging and addressing customer complaints, the timelines for resolving such complaints, and how unresolved complaints may be escalated to the Bank of Ghana.
Where a customer is not satisfied with how the complaints has been dealt with by the licensed institution, the guideline provides for the person to take the matter to the bank of Ghana or proceed to the courts to seek redress if the BoG did not meet the complainant’s expectation.
By Salifu B.B. Moro