New Report Reveals Consumer Credit Card Complaints Skyrocketed Amid Pandemic
Consumers filed 58% more complaints in 2020 after the COVID-19 pandemic gripped the United States, many of them related to financial fraud, inaccurate information on credit reports and a lack of help from credit card companies. The new data comes from “The State of FinServ Customer Experience 2021 Report,” released today by experience analytics solutions provider Stratifyd.
Credit Reporting Complaints, Fraud and Frustration All Skyrocketed During Pandemic
When the pandemic took its grip on the country in March 2020, companies laid off massive amounts of the workforce as facilities closed and moved to a “safer at home” environment. By April 2020, the unemployment rate spiked to its highest rate of 14.8% before gradually coming down.
During that time, Americans who were suddenly out of work found frustration and confusion from their financial institutions. According to data from the Aite Group, bank and credit card provider call center volume increased by 40% in the months immediately after the pandemic began. With consumers unable to ask their banking partners for help, confusion on aid programs and fraud continued to rise.
Starting in the second quarter of 2020, the Federal Trade Commission received over 1,000 complaints per quarter, the majority of them revolving around fraud and identity theft. With the traditional complaint routes inundated with requests, 27% of consumers filed a second complaint, signifying their issues were not dealt with in a timely fashion.
Complaints about credit reporting and credit repair services sharply increased as well. Among all issues sent to the Consumer Financial Protection Bureau, 64% were related to either wrong information reported to credit bureaus or inaction from credit repair services.
“Financial institutions can learn valuable lessons from the complaints of consumers,” Derek Wang, founder and CEO at Stratifyd, said in a press release. “Too often, financial service providers rely on their own customer surveys and proprietary data to uncover consumer trends and sentiment. But to truly understand and improve the full customer experience they’re offering, financial institutions must analyze data across a variety of channels.”
Lack of empathy from financial institutions not only created heartache for households but was also a major point of contention. Among complaints about specific policies or fees, consumers felt it was unfair that their providers would not change late fees or lower rates when others were getting help on mortgages and auto loans.
Financial Institutions Need to Change Customer Experience Based on Complaint Volume
The report concludes that as the nation moves beyond the pandemic, banks need to take the opportunity to learn from the once-in-a-lifetime event and create a better customer experience. The suggestions include using CFPB complaint data regarding “voice of the customer” data, and using complaint analytics from all data sources. This would allow companies to create changes that reflect customer perception as well as customer experience.
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