KEY POINTS:
The public is often too "terrified" of their bank to complain about the service they receive, says the banking watchdog in new findings out today.
The banking watchdog's annual report was released today and it reveals a slight rise in complaints for the 2005-2006 year to 774.
Of the five major banks, Westpac continued to be source of the most cases, followed by the National Bank, BNZ, ANZ and ASB. The figures largely reflected the banks' relative market share.
The number of cases from National Bank rose sharply while those from sister bank ANZ fell significantly.
The report found that many bank staff did not know their company's complaints procedure.
Commenting on the release of the report at 5pm today, Banking Ombudsman Liz Brown said for the average bank customer, "it can be a fairly terrifying experience to be thinking about making a complaint".
The report found that over the 2005-2006 year, the total number of cases received by the Banking Ombudsman rose slightly to 774.
"It is likely that the scheme's inaccessibility to many bank customers is a factor in the current low level of complaints," the report said.
Ms Brown said people often remained too worried to complain - wrongly.
"Banks are big organisations, they're very powerful, after all they control your money. Frequently I've had people say to me that 'I was reluctant to complain to my bank. I was worried that they wouldn't take me seriously, I was worried I might be victimised'."
Brown said those were "baseless worries".
"Banks in fact handle complaints very well, but people do need the confidence to complain to them."
However, a review of the banking ombudsman scheme conducted by former Ombudsman Anand Satyanand, now Governor General, emphasised that more needed to be done to make the public aware of the scheme.
Among submissions to the review, "that was one thing that came through quite clearly," said Brown.
"As a small organisation there are limits to what we ourselves can do. We're reliant, to some extent, on banks to make sure their customers do know about our services when they need them and indeed they've got an obligation under the Banking Code of Practice to do that."
The Banking Ombudsman's most recent survey of how well banks were displaying information about the scheme had "rather disappointing results" with less than 50 per cent of bank branches displaying the Banking Ombudsman leaflet.
The survey also found "a worryingly high proportion of bank staff know little or nothing of their own banks complaints procedures".
Brown noted that as banks were competing more strongly on customer service than in the past, they had done "useful work" to improve complaints handling.
However, "in the strategic areas of training front line staff and raising awareness of the Banking Ombudsman scheme, banks need to do much more".
