BANK AND building society staff are giving “inexcusably” bad information about how much of their customers’ money would be protected if the provider were to go bust, an investigation has found.
Researchers from consumer group Which? posed as new customers to ask 13 banks and building societies basic questions about how the Financial Services Compensation Scheme (FSCS) works. Under the scheme, up to £85,000 of someone’s savings is protected if their provider goes under.
Researchers told the providers they had £100,000 to deposit into an account. But out of the 156 anonymous calls they made across 13 providers, not one member of staff gave an unprompted warning that £15,000 of this money would not be protected in the event of a collapse.
The 13 providers contacted were HSBC, Lloyds Bank, Nationwide Building Society, Barclays, Santander, the Co-operative Bank, First Direct, Royal Bank of Scotland, NatWest, Bank of Scotland, Halifax, Britannia Building Society and Yorkshire Building Society.
When asked specifically about savings protection limits, staff at Yorkshire Building Society and Halifax were the only ones able to give the correct answer every time.
One NatWest employee told a researcher: “I imagine it’s like PPI. The bank wouldn’t have anything to do with anything like that.”
Banks, building societies and credit unions must prominently display stickers or posters in branches to help raise consumer awareness of compensation levels, under rules brought in two years ago.
Richard Lloyd, Which? executive director said: “It is inexcusable that bank staff can’t give customers basic information about the compensation scheme if their bank goes bust.
“In the event of a collapse, this bad advice could cost people many thousands of pounds from their life savings. We hope this is a wake-up call to the banks that they need to improve staff training.”
Overall, HSBC came bottom with a score of just 51 per cent and Yorkshire Building Society came top with 88 per cent.
The British Bankers’ Association (BBA) said it was disappointed at the findings.
A spokeswoman for the BBA said: “The BBA will work together with the banks to look at the concerns raised in this survey to help make sure that customers are given consistent and accurate information on FSCS protection.”