FRANKFURT (Reuters) – Complaints from consumers about banks and other financial firms in Germany rose by a fifth last year, official data shows, as regulators flex their muscles to shore up trust in the sector.
BaFin, Germany’s financial watchdog, has been increasing its focus on consumer protection in the wake of the collapse of Wirecard, the blue-chip payment company that folded in an accounting scandal.
It received 15,000 complaints from consumers in Europe’s largest economy about their banks and other financial service providers last year, up from 12,500 in 2021 and a fourth consecutive year of sharp increases.
Gripes include long processing times for account closures, changes to terms and conditions, and shrinking branch networks, according to officials, bankers and consumer protection advocates.
The figures, reported by Reuters for the first time, will be made public in an annual report in May.
“It cannot be that financial institutions are doing well because they treat their customers badly,” Chan-Jae Yoo, a BaFin official, said in an interview.
Deutsche Kreditwirtschaft, an umbrella organisation that lobbies for German finance, said German banks are “extremely stable and robust” and confidence remains “high” and “unaffected” by recent turmoil stemming from the collapse of lenders in the United States and Switzerland.
But a survey last year by YouGov showed that degree of trust in Germany’s financial sector, essential for promoting wider financial stability and attracting capital to support economic growth, was below the global average, lagging the likes of Canada, Australia and major Asian markets.
Niels Nauhauser, a consumer advocate in the southwestern state of Baden-Wuerttemberg, has spent two decades fighting for consumer rights.
“The mere fact that consumers are increasingly asking us and seeking our advice is proof enough that they do not fully trust financial institutions,” he said.
A study this year by EY found 25% of those surveyed in Germany trust financial firms, 31% don’t and 44% were on the fence.
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