We are often asked the true cost of deploying Yabber, but it is not unusual for firms to avoid questions about the cost of non-compliance. We are frequently told by firms that they are confident that their call handlers are achieving appropriate customer outcomes, but that compliance department simply needs ‘a little bit of support’ to make call reviews more efficient. But do firms really know what is being said to customers? It appears not and the true cost of non-compliance can no longer be ignored.
Firstly, in July of this year, Standard Life was fined £30.8M (net, to take account of a 30% discount for accepting the FCA’s findings at an early stage) and now Prudential has received a fine of £23.8M (again net as a result of a 30% discount,).
The FCA findings are a déjà vu moment, “The documentation provided to call handlers created a significant risk that call handlers would fail to mention the open market option or make statements during calls which could discourage a customer from shopping around for a better deal.” This was coupled with inappropriate sales incentives, another déjà vu moment, which led to this FCA criticism, “sales-linked incentives for call handlers and their managers meant that call handlers might put their own financial interests ahead of ensuring fair customer outcomes. Call handlers were incentivised by the possibility of earning an additional 37% on top of their base salary and winning prizes such as spa breaks or weekend holidays”. Ouch! Finally, “Prudential also failed to ensure that documentation used by call handlers was appropriate and failed to monitor calls with customers”.
The Standard Life and Prudential ‘final notices’ are available on the FCA website at:
- Standard Life: https://www.fca.org.uk/news/press-releases/fca-fines-standard-life-assurance-limited-30-million
- Prudential: https://www.fca.org.uk/publication/final-notices/prudential-assurance-company-limited-2019.pdf
These fines are not the end of it; the cost of non-compliance escalates exponentially when the cost of redress is also considered. Not including the staff and administration costs of administrating the redress schemes (which themselves will be significant), Standard Life paid £25.3 million to 15,302 customers and now Prudential has offered approximately £110 million in redress to 17,240 customers (including ongoing annuity uplifts).
So, we think we can legitimately challenge clients when they ask us about our costs by responding with “what is the potential cost if you don’t adopt Yabber?”
Yabber enables firms to monitor 100% of their interactions with customers. Our platform delivers improved compliance, identification of key risks and measurement of staff capabilities. Monitoring 100% of all calls frees up compliance department’s time to focus on ‘red calls’ and ‘root cause analysis’ driving continuous improvement. Yabber can provide outputs in multi-formats, dependant on individual client requirements.
Give us a call to see how we help.