The FSA is proposing to abolish the two-stage complaint process as part of measures to drive up industry standards on complaint-handling.
The regulator published a consultation paper last week which sets out a series of proposals to change the complaints handling rules.
Currently, firms can choose to operate a two-stage complaint process. If a firm sends a written response within eight weeks of receiving a complaint, the firm must only provide a subsequent final response if the complainant remains dissatisfied.
The FSA says this process can be abused as some firms deal with complaints in a sub-standard way at the first stage.
The new proposals would mean the firm’s first response is its final response.
Other proposals include a requirement for firms to identify a senior individual responsible for complaint-handling.
The FSA is also considering setting out guidance so that firms can carry out a root cause analysis of what factors are triggering complaints.
Director of conduct policy Sheila Nicoll says: “Good complaint-handling standards should be the rule, not the exception, and complainthandling forms a key part of our intensive and intrusive approach to supervise how firms deal with their customers.
“We will continue to work closely with firms to help push up standards in this area and to deliver improvements in the way firms treat their customers. We have already referred two firms to enforcement as a result of poor complaints practices.”
The consultation closes on December 31.