Financial Ombudsman reveals rise in P2P lending complaints

Consumer complaints about peer-to-peer lending rose in the past financial year but still make up a small proportion of the overall total across financial services, official data shows.

Figures from the Financial Ombudsman Service (FOS) show there were 103 complaints regarding P2P loans during the 2019/2020 financial year, up 56 per cent annually.

The uphold rate also increased from 19 per cent to 37 per cent between the 2018/2019 and 2019/2020 financial year.

The FOS also reported a 56 per cent increase in general enquiries regarding P2P issues to 135.

The 103 P2P complaints make up just 0.05 per cent of the total 271,468 made across the whole of the regulated financial services sector last year.

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The total number of complaints is down from 388,392 a year before but the uphold rate increased from 28 per cent to 32 per cent.

Payment protection insurance remained the most complained about product, with more than 122,000 complaints, including a spike in complaints following the Financial Conduct Authority’s August deadline.

“The fundamentals of good customer service, and good complaint handling, are constant, and the majority of financial businesses know this,” Caroline Wayman, chief ombudsman, said

“However, some businesses still need to put fairness first in how they handle customer complaints. A key part of our work in the future will be to proactively prevent complaints, to stop unfairness arising in the first place.

“The unprecedented Covid-19 situation has already given rise to many new and complex questions of fairness when things go wrong in financial arrangements.

“If customers are unhappy with how a financial business has treated them, they can come to the Financial Ombudsman Service for free, and we will see if we can help.”

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