The number of New Zealanders making complaints about financial companies is soaring as the cost of living crisis continues to take a toll.
Financial Services Complaints Limited (FSCL), a not-for-profit service that helps resolve financial disputes, says it has had a 17 percent increase in complaints in the six months from July to December 2023.
It also recorded a 36 percent increase in disputes (cases the service formally investigates) over the same period.
Financial Ombudsman Susun Taylor said pressure from higher expenses is translating to more complaints.
"We are seeing the increasing financial pressure on individuals and families, due to the higher cost of living and interest rates, translating to a continuing increase in complaints," Taylor said.
"Following on from last year's upward trend, our latest statistics are showing no let-up in the number of complaints. Not surprisingly, we are seeing an increase in complaints about lending products (including car loans, personal loans, and credit cards) reflecting what is happening in the wider economy."
The majority of the complaints (54 percent) were about non-bank lenders - up around 14 percent on the same period last year.
Taylor said the increase in disputes may also be partly because people are more aware of their rights.
"Consumers are more aware of their rights now, and in challenging times, the role of independent dispute resolution services has never been more important."
There was also an increase in complaints about financial advisers (mortgage brokers, sharebrokers, insurance brokers), although overall adviser complaint numbers are low.
The service also saw a 50 percent increase in complaints about transactional service providers which are forex dealers, money transfer agencies and trading platforms.
"This could, in part, be due to the steady number of frauds and scams, and the increasing popularity of money transfer services, particularly as New Zealanders are travelling again," Taylor explains.
"It's a good reminder that when transferring money overseas, consumers should double check they have entered the correct account number and that the person requesting the money is a legitimate business or person.
"It's also important for consumers to contact their lender or financial service provider as soon as they have a complaint as the earlier this is done, the quicker it will likely get resolved. If it can't be resolved with the financial service provider, then they can bring the complaint to us."
If something has gone wrong with a financial service provider, people can make a complaint to FSCL at www.fscl.org.nz, by calling 0800 347 257, or by emailing complaints@fscl.org.nz.
