The Telegraph By Tim Wallace 12:01AM BST 17 Aug 2015
Despite multi-billion pound PPI payouts and years of fines for bad behaviour, a substantial proportion of bankers still feel pressure to sell inappropriate products
A survey of bank staff by consumer group Which? found that 27pc believe there is still pressure to sell because of the culture in their bank. That is down from 43pc when the study was carried out in 2012, but still amounting to a substantial proportion of workers in the industry.
This pressure means that 28pc of staff at the big five banks sometimes feel under pressure to sell regardless of whether or not the product is appropriate for their customer, and 28pc are also uncomfortbale with their employer’s approach to sales, Which? found.
“I’ve spoken to the chief executives of all the major banks, and at the top there has clearly been a recognition that it is bad for business to allow the kind of behaviour that has been so systemic in the past to continue,” said Which?’s executive director Richard Lloyd.
“But that does not transform the organisation overnight. It is quite easy for middle managers or those further down the bank to simply rebrand sales targets and keep the pressure on staff up, which could result in mis-selling in other ways.”
One positive sign of progress is that 78pc of staff now believe there is a greater emphasis at their bank on customer service than on selling products, according to the survey of 383 front-line staff from Barclays, HSBC, Lloyds Banking Group, Royal Bank of Scotland, and Santander.
That is a marked change from the pre-financial crisis years, when millions of customers were sold products like payment protection insurance which they were not often aware of paying for, and was often unsuitable for the buyer.
Since then banks have paid a total of £24bn in compensation to customers who were wrongly sold PPI. Other mis-selling scandals include the sale of interest rate swaps to small firms who sometimes ended up paying hundreds of thousands of pounds or more for products which they thought would protect them against any rise in interest rates.
He is concerned that the change at the top of the Financial Conduct Authority could result in a boss who is less strict than outgoing chief Martin Wheatley, sending a signal to banks that there is a reduced pressure to reform their organisations.
“It is a worrying position at the moment, there is still a long way to go and if the FCA takes the pressure off, we could quite easily see the situation slide back to what we found in 2012,” Mr Lloyd said.
“We are realistic about the ability to stamp out mis-selling completely – there will never be a day when a middle manager will not put anyone under pressure to sell – but we need to see more changes to keep the culture improving and more pressure from the regulator to keep up the work they have already been doing.”